VANCOUVER, BC, March 2, 2022 /CNW/ – The National Coalition Against Contraband Tobacco (NCACT) has responded to the filing of from British Columbia Budget 2022 which provided for the application of provincial sales taxes on tobacco. If the budget is passed, this will represent an immediate 7% increase in the cost of legal cigarettes in the province.
“The increase in tobacco taxes through Canadawithout being paired with action against contraband tobacco, has proven time and time again to drive individuals into the illegal tobacco market,” began Gary GrantNCACT National Spokesperson.
An example of this is the most recent federal budget, which introduced a 17% price increase on cartons of cigarettes. In response, the Parliamentary Budget Officer noted that the tax would not increase government revenue, but found that past increases in tobacco taxes had contributed to the contraband tobacco market. This is due to the price difference between legal and illegal cigarettes. Legal boxes will now sell for more than $160 in British Columbia, when a carton of illegal cigarettes sells for less than $60.
“Other provinces have taken a cautious approach to tobacco taxation, while investing in enforcement measures to combat contraband tobacco. This allowed them to increase tobacco tax revenue, while reducing organized crime activity,” Grant continued.
In 2019, the government of British Columbia reported having seized five million illegal cigarettes in one year, representing a potential tax loss of $1.4 million. Quebec has a contraband tobacco market similar in size to British Columbia and in the same year reported disrupting more than $200 million of illegal cigarettes through targeted enforcement actions. If nothing is done in British Columbia, there is a risk that it will create a contraband tobacco market like Ontariowhere 1 in 3 cigarettes is illegal and the government wastes more than $750 million per year in tobacco taxes.
“British Columbia is currently only tackling the tip of the iceberg when it comes to the contraband tobacco market operating in the province. Criminal gangs can operate with impunity without provincial action and earn millions of dollars a day from illicit trade which they use to fund other illicit activities, such as drugs, guns and human trafficking. With this tax increase and no further action against illegal cigarettes, organized crime will continue to thrive,” Grant concluded.
The National Coalition Against Contraband Tobacco is a Canadian advocacy group made up of organizations and associations concerned about the growing danger of contraband cigarettes. NCACT members share the goals of working together to educate people and urge the government to take swift action to stop this growing threat. More information about the Coalition can be found on our website, www.stopcontrabandtobacco.ca.
SOURCE National Coalition Against Contraband Tobacco (NCACT)
For further information: Media Contact: Kyle Larkin, NCACT Public Affairs, Phone: 905-449-9077, Email: [email protected]