Ontario Convenience Stores Association (OCSA)

Ontario Convenience Stores Association (OCSA)

May 07, 2014 10:24 ET

Despite Election, Windsor Retailers Still Hit Hard by Tobacco Tax Increase

WINDSOR, ONTARIO--(Marketwired - May 7, 2014) - Ontario's convenience store retailers are warning that efforts to reduce contraband tobacco will be negated by the latest tobacco tax increase, which was implemented even though the provincial budget did not pass last week.

The increased tobacco taxes were put in place as of midnight last Thursday, May 1st. Retailers are doubtful that the government will be able to collect additional taxes with this increase, given the high rate of contraband in the Windsor area.

"This will only drive more customers away from my store and further the divide between lawful and unlawful retailers of tobacco products," says Terry Yaldo of Midway Convenience in Windsor. "We cannot compete with the inexpensive tobacco available in the illegal market. I only hope that small independents will be able to survive this cheap political move."

Contraband tobacco is sold without mandated health warnings and without age verification checks, to anyone who is willing to buy. The RCMP estimates that over 70 organized crime groups and gangs are affiliated with the illegal tobacco trade. Increased taxes and regulations drive the tobacco market underground, meaning these products are both more affordable and accessible to youth.

Prior to the Ontario budget, retailers presented 20,000 signed postcards to Premier Kathleen Wynne asking that provincial tobacco taxes not be raised.

Windsor areas have illegal tobacco rates as high as 39.6% in some locations, according to a contraband tobacco study released by the Ontario Convenience Stores Association in December 2013.

"The commitments made to address contraband tobacco feel empty, particularly given that we've seen these measures announced before," reminds Dave Bryans, CEO of the Ontario Convenience Stores Association. "The decision to raise tobacco taxes will push consumers to the black market and support organized crime in the process. This is an extremely short-sighted decision that threatens small business across this province."

Contact Information

  • For further information or to arrange an interview,
    please contact:
    Summa Strategies Canada
    Katlyn Harrison
    613.235.1400
    kharrison@summa.ca