The Canadian Cancer Society strongly supports the tobacco tax increase in the bill of $4 per carton of 200 cigarettes. Higher tobacco taxes are the most effective strategy to reduce smoking, especially among youth.
Tobacco remains the leading preventable cause of disease and death in Canada, killing almost 48,000 Canadians each year and causing 30% of cancer deaths. Higher tobacco taxes are a win-win, improving both public health and public revenue, with the budget indicating $2.1 billion in incremental revenue over five years from the tobacco tax increase. Thank you to this committee for its pre-budget recommendation to increase tobacco taxes.
Successive federal finance ministers have recognized the importance of higher tobacco taxes, including Michael Wilson, Paul Martin, Jim Flaherty and Bill Morneau. The strategy over time has worked, and Canadians are supportive. Canadians do not want kids to smoke.
Tobacco companies raise the issue of contraband, as they always do. However, tobacco companies have increased their own net-of-tax prices by $20.20 per carton over a seven-year period. There's no indication that these price increases have led to higher contraband. The tobacco industry has no credibility when it says government should not increase tobacco taxes, yet at the same time has massive price increases of its own. These manufacturer price increases have resulted in $2 billion in additional revenue per year going to tobacco companies, revenue that should be going to governments.
The budget also includes a tax on vaping products—though not in this bill—effective in 2022, a measure that we also strongly support to respond to the dramatic increase in youth vaping.
We welcome your questions.