Evidence of meeting #28 for Public Safety and National Security in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cbsa.
A recording is available from Parliament.
C/Supt Mike Cabana
That's correct. They received cross-designation to be able to operate on both sides of the border.
Liberal
Liberal
Sue Barnes Liberal London West, ON
So both the RCMP and the U.S. Coast Guard would be armed, and the vessels would be armed as well.
What authority is there for the U.S. Coast Guard bearing arms inside Canada's sovereign territory? What was done to allow that?
C/Supt Mike Cabana
The pilot project was implemented following a diplomatic note between the two countries, and with administrative forbearance on some of the acts in place on both sides of the border. As to the carriage of firearms, the U.S. Coast Guard personnel were cross-designated under the RCMP Act as supernumerary constables. When they were operating on Canadian soil, they were operating under the direction and supervision of Canadian officers.
Liberal
Sue Barnes Liberal London West, ON
So an exception was made to the rule covering another sovereign country's ability to carry firearms in Canada.
Liberal
Sue Barnes Liberal London West, ON
But it wasn't brought through Parliament. Under what authority was it done?
Liberal
Sue Barnes Liberal London West, ON
Okay. Is that because it was an exception? If this type of operation were continued in future, would it be a continuing exception?
Liberal
Sue Barnes Liberal London West, ON
Or would you do something legislatively, so that the rest of Canadians would understand this?
C/Supt Mike Cabana
Exactly, and that was the purpose: to see if there would be a benefit in going down that road. The proof of concept actually proved to be quite beneficial in affecting the criminality in the area. As a result of that, diplomatic notes were exchanged earlier this year between the two countries. The official negotiation of treaty agreements between the two countries commenced in February-March of this year for that specific purpose, to develop a legal framework so that if we have any further initiatives such as Shiprider, they are done under the context of appropriate laws.
Liberal
Sue Barnes Liberal London West, ON
I would hope that is done openly the next time and not like this, as an exception to our laws in Canada. I'll put that on the record.
For the second question, I'll just do a follow-up with respect to the precursors for the materials to produce illicit tobacco products. What controls will be on the paper and the filters for the production? And how will you manage that control system?
Director, Excise Duties and Taxes Division, Excise and GST/HST Rulings Directorate, Legislative Policy and Regulatory Affairs Branch, Canada Revenue Agency
I'm sorry, but someone's coughing and I missed part of your question. Would you re-ask it?
Liberal
Sue Barnes Liberal London West, ON
Okay. I'm talking about the raw material to create illicit tobacco products. You talked about the machinery. I'd like to know what control you would have on paper and filters, because there don't seem to be control relationships right now in what's in the works, what's planned. I don't think the budget 2008 does cover that, so tell me what you're planning to do.
Director, Excise Duties and Taxes Division, Excise and GST/HST Rulings Directorate, Legislative Policy and Regulatory Affairs Branch, Canada Revenue Agency
There is nothing in the Excise Act of 2001 that gives the Canada Revenue Agency the right to deal with those products in any way. In all honesty too, some of these products are multipurpose, and determining what filter tool may be used and whether it's air filters, car filters, or cigarette filters would be difficult. We don't have responsibility for that at this time.
Liberal
Sue Barnes Liberal London West, ON
Thank you. I think that is a control mechanism that could be pursued, that might be effective, just as if you have the raw product of raw leaf and you're tallying that. These are obviously tools of the trade.
Thank you. I'm sure my five minutes are up.
Liberal
The Vice-Chair Liberal Roy Cullen
Just about. Thank you, Ms. Barnes.
Now, Monsieur Bouchard, s'il vous plaît.
Bloc
Robert Bouchard Bloc Chicoutimi—Le Fjord, QC
Thank you, Mr. Chair.
Thanks to you too for appearing before us this afternoon. My question is for both Mr. Cabana and the Canada Revenue Agency representative.
It is my understanding that it is nearly impossible to quantify the proportion of illegally sold tobacco products that come from China, the United States, South America and Canada. Right now, the illegal tobacco product trade is at a significant high.
Do the existing legislation and regulations and your procedures give you the necessary tools to put an end, or at least reduce that contraband trade?
C/Supt Mike Cabana
Thank you very much, Mr. Bouchard.
Currently, to deal with the problem, several tools make up the arsenal that is at the disposal of agencies responsible for law enforcement That being said, I would not go as far as to say that we have all of the tools necessary to crack down on criminal organizations' ability to adjust to the initiatives put in place by governments and police agencies.
Various laws and tools at our disposal enable us to deal with criminal organizations at the root of the problem. However, the agencies represented here today have the duty to continue reviewing the problem. We've discussed and suggested precursors; this is another possibility. We cannot close the door saying that we have everything we need.
Bloc
Robert Bouchard Bloc Chicoutimi—Le Fjord, QC
As I was listening to the list of seizures and where they were made, I wondered how you would qualify the current situation. Do we have control of the situation, or have we lost it? Are we, or are we not completely overwhelmed by events? My question is for Mr. Cabana and the representatives from Revenue Canada.
C/Supt Mike Cabana
Let's just say that I'm not appearing before this committee today to state that we have control over the situation and that there is no problem. Yet, I would not say that we have lost control of this particular situation. There is some distance between the two extremes. The problem is on the rise, which been confirmed by the number of tobacco seizures made in recent years. The document announced by the minister today is an attempt at redeploying efforts specifically with a view of controlling the problem of contraband tobacco.
Bloc
Robert Bouchard Bloc Chicoutimi—Le Fjord, QC
My last question is for the Canada Revenue Agency.
In your document, you say that in 2003-2004, accise revenue totalled $3.35 billion, but that there were $2.492 billion in 2006-2007. I've calculated the difference, the result indicates that the agency has lost $868 million.
Based on the difference between these two periods, have you made more detailed calculation of the losses incurred by the agency?
Director General, Excise and GST/HST Ruling Directorate, Legislative Policy and Regulatory Affairs Branch, Canada Revenue Agency
With respect to the losses and the gap in revenue for these two years, there was no study conducted to determine whether this was a result of Health Canada's policy on tobacco use or the fact that contraband tobacco had become the prevailing problem. We have no statistics on this matter.