Cigarette prices keep going up and there are increasingly less places one is free to smoke. Cigarettes cannot be shown in stores and cannot be advertised. It is not an illegal habit – it is just an increasingly inconvenient one to enjoy. Even with the stigma of death being attached to each pack and the constant reminder of health repercussions to the smoker and those around them, smoking continues to be seen everywhere. However, it is not just the traditional corporate brands being enjoyed. Many of them are lesser known brands of contraband cigarettes. The National Coalition Against Contraband Tobacco and The Canadian Convenience Stores Association recently released a report explaining a connection between illegal cigarettes and organized crime including drug and weapons smuggling. The CCSA points to contraband cigarettes being the primary cause of difficulties felt by convenience store owners around the country.

The difference in price is large – it can be $2 for those acquired through a native connection, versus $10 acquired from a regular convenience store for the same sized pack of 25. The 2009 Butt Study again showed that 30 percent of butts examined at 110 Ontario and Quebec high schools were not purchased at a convenience store. People are less inclined to pay the exorbitant cost in taxes, both provincial and otherwise, which are applied to cigarettes and would prefer to pay their native friends instead. Although these actions may be reflective of a time of global recession where money is tight or even a subconscious demonstration by smokers to show they have just had enough, the repercussions can be greater than they first realize. With an estimated 50 percent of cigarettes in the country’s streets being illegal, the estimated loss of tax revenue is nearly $2 billion according to a report by the Canadian Tobacco Manufacturers Council. Additionally, 30 percent of small convenience stores may close due to profits lost by cigarette purchasers frequenting their stores less and less.

Attempts to stifle contraband cigarette sales are in place but where there is demand and a will, there is a way. RCMP spokesperson Marc LaPorte said that production of contraband tobacco rose over the past five years, as manufacturing on native reserves has increased. Though the RCMP managed to seize more than 570,000 cartons — each containing 200 cigarettes — last year, LaPorte says that’s not alleviating the problem of the illegal cigarette trade. “Our intelligence tells us that we’re seizing only about 10 per cent of what’s out there.” It is estimated that about 13 billion illegal cigarettes are sold in Canada annually.

If 50 percent of the cigarettes being smoked are illegal and 10 percent are being stopped, and there is a 500 percent price difference between native smokes and corporate brands, resulting in business closures and increased job losses, a closer look at the matter is in order. When the government loses $2 billion in tax revenue from unhappy smokers who had remained reasonably quiet up to this point, and now allow their actions to speak for them, the issue needs to be addressed. If there is indeed a connection between illegal cigarettes and the trafficking of guns and drugs, steps must be taken. Benjamin Kemball, president of Imperial Tobacco Canada, explains that community groups, business organizations and health groups are calling for government action.

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Tags: contraband cigarettes, Crime, drugs, illegal trade, tax revenue

This entry was posted on Monday, November 16th, 2009 at 10:04 pm and is filed under Crime. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.