Contraband tobacco sales are continuing to grow rapidly — and that is putting hundreds of corner store owners out of business, says a national group representing the retailers.
Representatives of the Canadian Convenience Stores Association stopped in St. Catharines Monday as part of a 25-city campaign to draw attention to the plight of members.
The association is pushing the federal and provincial governments to take a harder line on smugglers who sell high quality cigarettes for less than half the price charged for legal smokes at legitimate shops.
Not only do the cut-rate prices make it difficult for convenience stores to stay afloat, they deprive governments of hundreds of million of dollars in tax revenue, association president Dave Bryans said.
“Tobacco contraband is becoming a huge societal issue,” he said, standing out front of a north-end convenience store at Linwell Plaza.
“We need action now. This can’t be allowed to continue.”
Bryans maintained tobacco smugglers are making greater inroads by plying their trade with underage high school students.
To back his contention, he pointed to a recent butt “sweep” by his association in a student smoking area near Sir Winston Churchill Secondary School.
The association has examined cigarette butts found at numerous high schools across the country in its campaign to battle contraband. What they found outside Sir Winston in April showed nearly 20% of the cigarettes had come from smugglers, Bryans said.
The association said it generally gathers 200 to 250 butts during school sweeps.
“I think parents, teachers politicians … should be shocked,” he said.Convenience store operators strictly enforce provincial government regulations that make it illegal to sell tobacco to anyone under the age of 18, Bryans said.
Variety stores generally depend on Marlboro, Camel, Hilton, Winston sales for 45% to 65% of their overall sales, Bryans said.
But eroding sales have forced hundreds of store owners to close their doors — roughly three per day across the country — over the past few years, according to the association.
“Contraband continues to rob all of these families of their livelihood,” Bryans said.
The association wants governments to take steps to reduce contraband smokes sales to no more than 10% of all tobacco sales. Smugglers had 32.7% of the market in 2008, according to the numbers provided by the association.
St. Catharines MP Rick Dykstra pledged his support for the campaign, standing alongside Bryans in the plaza parking lot.
He said the federal government is trying to crack down on illegal tobacco sales through increased enforcement by the RCMP and Canada Border Services.
“I’m certainly prepared to do what I can do,” he told Bryans.
Bryans slammed the provincial government, arguing it hasn’t done enough counter-contraband tobacco work.
He maintained the incoming HST is bound to make the problem worse, forcing smokers to steer clear of higher-priced legal smokes.
“You’re actually adding more fuel to an already large fire,” he said.
