Contraband tobacco in Ontario: continued government attention insufficient, had hoped for new measures

Over a billion in lost taxes finance organized crime, new and stronger action is needed
NCACT media op to be held today near Queen's Park

OTTAWA, Nov. 18, 2014 /CNW/ - The National Coalition Against Contraband Tobacco (NCACT) acknowledges that the government of Ontario continues to identify contraband tobacco as an important problem, but had hoped that Finance Minister Charles Sousa would use yesterday's fall economic update as an opportunity to introduce stiff new measures to address the problem.

"The NCACT recently published a study reporting that in July 2014, a shocking 42% of cigarettes purchased in Ontario were contraband, for a yearly average in 2014 of more than 30%. We have been urging the Ontario government to introduce tougher measures to tackle contraband tobacco for quite some time. Ontario has the most illegal cigarettes in the country," commented the National Spokesperson for the NCACT Gary Grant, a 39-year veteran of the Toronto Police Service. "Existing solutions have not proven sufficient to address this problem; it is important that new measures be introduced and that existing measures be reinforced," concluded Grant.

Yesterday's Economic Update included a reminder of the government's introduction of regulations to control raw leaf tobacco, which will be implemented on January 1^st. It also re-highlighted an ongoing pilot project with Aboriginal communities in Ontario, fines for possession of contraband and a review of the aboriginal allocation system in 2015. The raw leaf regulations have been announced 6 times and the pilot program 5 times since 2012, the allocation system 3 times since 2013.

In the past, NCACT has encouraged the province to adopt a variety of anti-contraband measures including those that, as in Quebec, would empower local police to conduct anti-contraband tobacco investigations. The NCACT has also encouraged Ontario to curb supply by licensing non-tobacco cigarette manufacturing materials, such as those related to the production of cigarette filters. The NCACT is also asking the government deploy an important public service announcement campaign warning of the criminal and social impacts and consequences of contraband tobacco in local communities.

"Ontario has committed to introducing new anti-contraband measures in every budget since 2012, but up to now has yet to do so," continued Grant. "That's unfortunate, as other jurisdictions, such as Quebec, have demonstrated anti-contraband measures such as increased powers for local police can have a real effect. Hopefully this Friday's upcoming joint Quebec and Ontario Cabinet Ministers' meeting between the two provinces can provide an opportunity to discuss what has and hasn't worked, and draw from Quebec's best practices."

The contraband tobacco trade in Ontario is a major criminal enterprise. The RCMP estimates that there are 175 criminal gangs profiting from the sale of illicit tobacco, with 50 illegal factories in operation, each using equipment that can produce as many as 10,000 cigarettes a minute. These organized crime groups use the proceeds from contraband tobacco sales to fund their other activities, including guns, drugs and human smuggling. And the proceeds are lucrative: the Financial Transactions and Reports Analysis Centre of Canada identified $100 million in suspicious financial transactions between 2006 and 2012 from one contraband hotspot alone.

Illegal cigarettes carry other serious social costs. With a "baggie" of 200 contraband cigarettes costing as little as $8, and because the criminals involved in the trade don't check for I.D., contraband tobacco is a prime source for youth smoking. In fact, the Centre for Addiction and Mental Health study highlighted contraband tobacco's low cost and easy availability as a reason for Ontario's stubbornly high youth smoking rate.

"Only with increased action will the amount of contraband tobacco in communities across Ontario decrease," said Jacqueline Bradley, Executive Director for the NCACT. "While the Fall Economic Update did not include such measures, we hope to and welcome the opportunity to work with the province to identify appropriate measures and best practices that will bring the contraband tobacco problem under control. Doing so hurts criminal gangs, fights youth smoking, and bolsters Ontario treasury. That's a win for everyone."

The NCACT is holding a photo op today at 12:30 at Queen's Park TTC station to inaugurate an ad campaign warning Ontarians of contraband tobacco's cost to individuals. The NCACT's National Spokesperson Gary Grant and Executive Director Jacqueline Bradley are also available for interviews by telephone and in person in the GTA.

ABOUT THE NCACT
The National Coalition Against Contraband Tobacco is a Canadian advocacy group formed by organizations and associations concerned about the growing danger of contraband cigarettes. NCACT members share the goals of working together to educate people and urge government to take quick action to stop this growing threat.

The members of the NCACT are: Association des détaillants en alimentation du Québec (ADA), Association des marchands dépanneurs et épiciers du Québec (AMDEQ), Canadian Chamber of Commerce, Canadian Convenience Stores Association (CCSA), Canadian Manufacturers and Exporters, Canadian Taxpayers Federation, Canadian Tobacco Manufacturers Council, Conseil du patronat du Québec (CPQ), Customs and Immigration Union, Échec au crime Québec, Fédération des chambres de commerce du Québec (FCCQ), Frontier Duty Free Association (FDFA), National Convenience Stores Distributors Association (NACDA), Ontario Chamber of Commerce, Retail Council of Canada, Toronto Crime Stoppers and United Korean Commerce and Industry Association (UKCIA).

SOURCE: National Coalition Against Contraband Tobacco (NCACT)

Kalene DeBaeremaeker, (p) 1 866 950-5551, (m) 613 857 1758, (e) [email protected]