Kenny Shim (Photo: Jaime Hogge)
Industry advocates are rallying to bring political awareness to the cigarette trafficking problem in the lead up to Ontario's budget.
The Ontario Korean Businessmen's Association (OKBA) is relaunching its Save Our Stores Campaign and president Kenny Shim spoke at the Ontario pre-budget consultations in Toronto last week.
In a release the organization said it "is making good on their promise to press the Ford government to finally crack down on illegal tobacco sales in the province; a problem that has caused hundreds of small businesses to close permanently over the last decade."
The OKBA, which represents more than 900 c-store members across Ontario, maintains that legal store owners are paying the price for illicit tobacco. The group says that it has lost close to 1,000 members in the past decade "many of whom have closed their businesses permanently due to unfair competition from organized crime groups selling contraband."
Industry advocates says c-store owners are frustrated by the ongoing inaction, and are calling on the Government of Ontario to follow through on commitments in the "Addressing Unregulated Tobacco" section of last year's budget, including modernizing the Tobacco Tax Act to expand enforcement partnerships with interested provincial, local, and First Nations police services.
"Many of our store owners see organized crime groups selling contraband tobacco right out in the open," said Shim "Police must be empowered to get more involved, and we know this would make a positive difference, because we hear from our counterparts in Quebec that the contraband situation has improved there. We want the Ford government to give police the powers they need to crack down on this serious problem."
The Province of Quebec spends $20 million annually on contraband enforcement, whereas Ontario reportedly spends $1 to $2 million. And according to the National Coalition Against Contraband Tobacco in 2019, Quebec's investment in tackling the illegal tobacco trade has yielded a 10:1 return, with tobacco tax revenue increasing by $180 million annually without any tobacco tax increases. It is estimated Ontario is losing up to $750 million annually due to unregulated tobacco sales.
According to police, many organized crime groups that profit from contraband tobacco are also involved in other illegal activities.
"We believe the public needs to know about the unfair challenges our store owners face," says Shim. And the massive tax losses for all Ontarians. As licensed retailers, we follow all government mandates, and we pay our taxes. It is extremely frustrating that contraband dealers are still not more seriously dealt with. We expect the Ford government to take a firm stand against illegal tobacco, to help our communities and law-abiding store owners stay in business."