More than four years ago, in the lead up to the 2018 Ontario election, the then opposition PC Party campaigned they would get tough on contraband tobacco. We had great hopes that a Ford government would finally address this issue but have been disappointed by the lack of concrete action.
This inaction has led to more convenience stores permanently closing, billions in lost taxes dollars for government, and continued profits for organized crime groups trafficking contraband tobacco.
Enough is enough!
Soon, we will all start hearing from candidates seeking our vote in the upcoming June 2nd election. While governments have been understandably focused on overcoming the challenges brought on by the pandemic for the last two years, there is no longer any excuses for ignoring the contraband tobacco problem plaguing our province.
As licensed retailers we know first-hand the amount of illegal tobacco that is readily available in our local communities. And it’s up to all of us to let candidates from all parties know, including incumbents and first-time candidates, that its time Ontario gets serious about this problem.
Solving the contraband issue completely will be difficult, if not impossible, however implementing practical and proven measures that have worked in other provinces will have a big impact and return on investment for the people of Ontario.
Government is not motivated to act on this issue, as most Ontarians are unaware of the harm caused by the illegal trade of tobacco, let alone its impact to small business owners and the communities they serve. That’s why it is critical that more and more convenience store owners get involved.
We need to tell people in government what we have witnessed in the time we have owned and operated our businesses. It’s time to tell politicians that this issue MUST be dealt with NOW!
One of the most significant examples we can all point to, was the sudden rise in legal tobacco sales experienced during the initial pandemic lockdown, in the spring of 2020. Supplies of illegal tobacco were cut off because of the stay-at-home order issued by the government and closure of most businesses across the province. During a period of several weeks, we saw a significant increase in legal sales as smokers came back to the legal market.
This not only provided a benefit to legal manufacturers and retailers, but also to government who recouped millions of dollars of tax revenue during that time. Government knows the impact the lockdown had, and now have real life proof that when illegal products are harder to access, most consumers will come back to the legal channel.
While contraband tobacco continues to represent as much as 40% of all tobacco consumed in this province, Ontario is quickly becoming the number one exporter of illegal tobacco to other provinces. Since the Ford government was elected in 2018, there has been a steady rise of incidents where illegal tobacco being shipped from Ontario has been confiscated in Manitoba and other western provinces.
Aside from losing up to $1B annually in tax revenues, the Ontario government must realize that its inaction against this illegal trade is only benefitting organized crime groups who traffic contraband tobacco with impunity.
Furthermore, an open-source review over the last 12 months has determined that narcotics such as cocaine, methamphetamine & fentanyl as well as guns, are increasingly being seized alongside contraband tobacco in police investigations. Of 27 contraband tobacco seizures in Ontario reviewed in 2021, 19 involved narcotics and firearms. That’s an alarming 70%!
Increased fines and penalties to those who traffic illegal tobacco and increased incentives to law enforcement to seize product and make arrests have helped Quebec drastically lower the percentage of contraband tobacco in their communities. Its time Ontario does the same.
I encourage all retailers to make their voices heard in this upcoming election campaign. We have had enough of promises, talks and consultations – it’s now time for action. Without it, more hard-working store owners will lose their businesses, while criminals continue to profit.
Enough is enough!
Mr. Kenny Shim