B.C. budget misses the mark on fighting contraband tobacco

Industry asks government to take action to keep communities safe and convenience stores open.
Cigarettes and wooden Judge gavel top view on black background. Violation of the terms of sale of tobacco. Tobacco law

In unveiling their first budget for British Columbia, Premier David Eby and Finance Minister Katrine Conroy missed the opportunity to counter contraband tobacco and its significant impact on B.C. communities, according to The Convenience Industry Council of Canada (CICC).

“Convenience stores play an essential role in communities across the province. Too many of them are closing, largely due to government inaction on contraband tobacco. While CICC welcomes the absence of new or increased taxes in this year’s budget, it won’t be enough to address the impact of organized crime on contraband,” Sara MacIntyre, CICC’s vice-president for Western Canada, said in a statement. “Store owners are also reporting nearly 40% reduction in legal tobacco sales. The massive proliferation of contraband tobacco across the province is not only a massive illegal industry that costs the government millions in lost tax revenues and affects the viability of the corner store, but it also threatens community safety. The increased resources for RCMP officers to improve community safety is a good first step. But the 2023 budget should have dedicated resources to a contraband tobacco task force.”

READ: B.C. retailers demand government take action against contraband tobacco

In recent months, convenience retailers large and small were united in advocacy efforts urging Premier Eby’s NDP government to get tougher on contraband tobacco.

CICC launched a website, with the name “Contraband Costs Us All” and its executives met with B.C. politicians and department officials across numerous portfolios.

In addition, about 200 owners of c-stores in rural B.C. came together to create the Retailers Alliance 4 Safe Communities (RA4SC) and launch a campaign called “Speak Up for Our Stores.” It includes a website as well as a Facebook and Instagram presence.

Cory George, owner of Pinantan General Store in Pinantan Lake, B.C., which has a population of about 500 residents, says sales started to slide in July when the B.C. government began applying PST of 7% on tobacco purchases on top of an already hefty tobacco tax.

He told CSNC that contraband is being sold out of these vans for as cheap as $200 for four cartons – about $50 a carton, compared to retail costs of about $180 a carton. 

The Select Standing Committee on Finance and Government Services Budget Consultation Report also recommended the B.C. government employ additional resources and enforcement to address the distribution of contraband tobacco and cannabis.

“Failure to control contraband tobacco strikes at the province’s tobacco control strategy. Contraband makes tobacco cheap, thwarting public health objectives and reducing tax dollars. We are asking the Premier and Minister Farnworth to establish a dedicated contraband tobacco unit. It will help keep communities safe and convenience stores open,” said MacIntyre.

The CICC is a national, not-for-profit association uniting retailers, manufacturers and distributors in the convenience industry who employ more than 212,000 Canadians and sell more than $55 billion annually in goods and services. In British Columbia, the CICC represents more than 2,300 stores and employ more than 19,000 British Columbians and thousands more indirectly.

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