Contraband and cheaper cigarettes
Smokers are price-sensitive, and may seek ways to purchase cheaper cigarettes, particularly as tobacco taxes increase the overall price of cigarettes. One such source is purchasing contraband cigarettes. Contraband is “any tobacco product that does not comply with the provisions of all applicable federal and provincial statutes. This includes importation, stamping, marking, manufacturing, distributing and payment of duties and taxes.”(vi, p.12) The Royal Canadian Mounted Police (RCMP) has identified the trade in contraband as a “serious threat to public safety and health.”(vi, p.15) The federal government has recently made contraband a priority issue for tobacco control in Canada, with a $91.7-million increase in funding to the RCMP over five years in the 2014 budget, and the passing of Bill C-10, the Tackling Contraband Tobacco Act, which received Royal Assent on November 6, 2014 but has not yet been proclaimed. Provincial governments in Ontario and Quebec also included additional funding for anti-contraband measures in their budgets in 2014.vii
Some of the sources of purchase reported below may include contraband, where appropriate taxation has been evaded, while others represent the efforts of smokers to legally obtain cheaper cigarettes.
Purchasing cigarettes – sources
Smokers were asked about various sources of purchase used in the past six months (Figure 3.2), and also about the proportion of their cigarettes purchased from each of the sources they had utilized.
Figure 3.2 data table with 95% confidence intervals
|Other||Smuggled||First Nations reserve||Store (total)|
|5.3 [3.1-7.5]||1.9 [0.5-3.2]||10 [7.9-12.0]||83.5 [80.6-86.5]|
NOTE: Smokers could indicate multiple sources, so these estimates should not be added
Data Source: Canadian Tobacco, Alcohol and Drugs Survey, 2013
Purchasing from stores
The majority of smokers reported having purchased from a store or gas station (not on a First Nations Reserve) in the past six months. Of those who purchased from a store, most (87.4%) purchased all of their cigarettes from a store.
Purchasing From First Nations
Of the 10.0% of smokers who reported purchasing on a reserve, 54.7% reported purchasing at least half of their cigarettes from a reserve, 24.1% purchasing all of their cigarettes there.
Purchasing from other sources
Of the 5.3% of smokers who reported purchasing from an “other” source, 45.2% reported purchasing at least half of their cigarettes from an other source, but relatively few purchased all of their cigarettes from that source.
Purchasing smuggled cigarettes
While Canadian Tobacco, Alcohol and Drugs Survey asks about purchasing of smuggled cigarettes, defined as “purchased cigarettes that were not manufactured on a First Nations Reserve, were not manufactured in Canada, do not contain a government of Canada Health Warning message and do not carry a tax stamp. Legally imported cigarettes are not smuggled cigarettes,” numbers were too low to report on their own.