moved:
That this House urge the government to introduce legislation to restore the tax on tobacco to the level existing at January 1, 1994, and to apply the revenue from the tax on tobacco to health care.
Madam Speaker, I rise today with varying emotions. On one hand it saddens me to have to present this motion, but on the other hand, it infuriates me.
The motion I am bringing to the House today, a motion to restore tobacco taxes back to the level they were in January 1994 and apply this revenue to health care is something we should not need to be discussing here at all. Unfortunately, I have been pushed to do this, given the tax rollback that occurred on February 8, 1994.
The reason for my sadness is that this reduction enacted by the government poses the single greatest threat to the health care of Canadians in the last 50 years. No legislation will have a more
detrimental effect on the health of Canadians than anything that has gone on in recent history. This is particularly germane to the youth of the country.
This rollback will cause hundreds of thousands of people to take up smoking, half of whom will die of cigarette related illnesses such as pancreatic cancer, lung cancer and suffer from illnesses such as chronic obstructive lung disease, a disease that tears away at the very fibres of somebody's lungs so that if they were to walk from where I am to where you are, Madam Speaker, they would be severely short of breath and exhausted.
We are not even talking about the pain and suffering that is endured by the hidden victims of this, the families of the patients.
Already in the six months after the rollback the sales of cigarettes are up 41 per cent. The number of people smoking has also increased, especially among youth, going from 23 per cent to 27 per cent now. This trend is completely opposite to what was going on since 1982 when the tobacco taxes were raised and the cost increased.
I am chagrined that the standing committee of management has decided not to make this motion votable. This issue was highly contentious back in February. The vast majority of the public opposed it, virtually every health care professional vehemently opposed it, and yet the government brought it forward.
If this motion had been made votable it would have enabled members to truly represent the wishes of their constituents and vote for this motion which would have such a significant impact on the health and welfare of Canadians.
Before we look at the reasons for my motion and the constructive solutions that I pose, it is wise for us to look at the situation that existed in February 1994. Up until that time Canada was a leader in the fight against tobacco consumption. Interestingly enough, in 1979 virtually half of all 15 to 19 year olds smoked. However, because of the increase in taxes on cigarettes and the cost, by 1991 this percentage had fallen to 16 per cent, something of which Canada was justifiably very proud.
This rate of reduction was unparalleled in the world. The cause of this was cost.
It is estimated that had the proportion of tobacco users in Canada remained at 1979 levels, there would currently be three million more smokers in this country today. All statistics show this powerful relationship between price and consumption.
As a result of these tax increases, a price differential existed between Canada and the United States in the order of $48 a carton in Canada to $25 a carton in the United States. This was a double-edged sword and the smuggling of contraband cigarettes became rampant. Cigarettes were exported legally into the United States but were illegally brought back into Canada, primarily through the reserves in Quebec. Some contraband was brought in through other conduits, private cars and through the mail routes, but they were minimal compared to what was occurring on the three reserves in Quebec.
When analysing the smuggling, it is wise to divide up the situation between Quebec and the rest of the country. The smuggling that was occurring in Quebec had a profound effect on the lives of the people living there. Quebec represents 30 per cent of cigarette consumption, 70 per cent in the rest of the country. In Quebec one-third of the cigarettes that were purchased were purchased legally and two-thirds were purchased illegally, a complete reversal to what was occurring in the rest of the country.
Also at this time a tragedy was occurring. The smuggling was occurring right before the noses of our judiciary and our police forces. They were directed to look the other way. Why? To avoid confrontation, to avoid an Oka situation that nobody wanted. It is completely unfair to have a legal situation that looks at the law and enforces the law in one area and in another area does not.
The smuggling not only occurs in contraband cigarettes but also involves drugs, liquor and illegal weapons, all of which are occurring right now. Getting rid of the smuggling of tobacco does not get rid of the smuggling of other contraband.
Outside of Quebec and parts of southern Ontario the smuggling was minimal. This was the dilemma that we were in. How the government reacted was appalling and incurred the anguish of many Canadians and every health care professional in the country. The reaction had the primary effect of increasing legal consumption of cigarettes and decreasing illegal consumption of cigarettes, which was worthy, and eliminating the smuggling of contraband cigarettes which is to be applauded. However there is another way of doing this.
They also brought in to eliminate these channels the export tax of $8, a pledge to increase enforcement and education against smoking, all of which I applaud.
Now that we have analysed the situation, let us look at the impact that this tobacco rollback had on the financial cost and the human cost of Canadians.
Let us look at the financial cost first. The loss of revenue to the provincial governments is massive. Tax revenues on cigarettes are estimated to decrease from $5.5 billion to $2.3 billion per year, a loss of $3 billion outside of Quebec. In Quebec tax revenues will decrease from $774 million to $559 million per year, roughly a $210 million decrease. The total loss in revenue to the public purse is $3.2 billion. The loss to gross national product is very difficult to quantify but in my province of
British Columbia it is estimated that if the decreases go ahead that it will cost $150 million per year.
Let us look at the human cost, something impossible for us to quantify. For every 10 per cent decrease in cost the overall cost in consumption is between 4 and 9 per cent for the general public. In youth and teenagers the major factor in determining consumption is cost. It results in a 14 per cent increase in consumption for every 10 per cent decrease in cost.
Thus we can see that the tax rollback has had a devastating effect on the health of Canadians, particularly in that group which is most vulnerable, the youth.
As I said in my opening statement, this has already been borne out. By the most conservative of estimates a 50 per cent decrease in price will result in a national increase of 14 per cent in consumption but in teenagers this increase is 35 per cent which translates into 840,000 smokers, 175,000 of which are teenagers.
Let us look at a more realistic view. It is a more chilling view. A 50 per cent decrease in cost will result in a 45 per cent increase in consumption which is close to the 41 per cent I originally mentioned. This is going to add 1.8 million more smokers to the list, of which 250,000 are teenagers. This great effect of consumption will not be in the areas where smuggling was maximal but in areas where it will be minimal. Tragically for the people who live in Quebec and for those in southern Ontario, the effect has already been felt because they have been consuming cheap cigarettes for a while.
The World Health Organization recently estimated, after long study, that 50 per cent of all smokers will die as a result of tobacco consumption. It kills in at least 24 ways. Each smoker will get 20 years knocked off their life expectancy.
To put it in more graphic terms, it will result in many times more deaths than all the people who died in World War I and World War II combined.
The increase in health costs are staggering. Smokers currently cost the health care system approximately $9.5 billion a year. The increase in consumption will result in an increase in health care costs of between $1.3 and $3 billion every year. Our health care system does not need this at all, it is in desperate need of funding currently.
The combined increase in health care costs and loss of revenue is between $4 and $6 billion per year to the Canadian taxpayer. This does not include the costs we are going to suffer in our loss of gross national product.
The Minister of Health stated that she wants Canada to exchange and share her expertise with other countries in an effort to decrease smoking. Madam Speaker, I hope not. I hope we do not do this. What she wishes to share is an increase in human suffering, an increase in death, an increase in deficits. I hope no country in the world learns those lessons.
The minister also stated that she would do anything to save even one life from the results of tobacco consumption, and in particular the youth. If this is true, then I have some constructive solutions.
First, continue with the $8 export tax. It was a very worthy move. It has proven it works. We have an example. In February 1992 the then government instituted an export tax of $8 per carton, the same as was instituted by this government. In four weeks it decreased the smuggling of contraband cigarettes by 60 per cent. It is important to remember this figure.
Second, enforce the law. Do not allow the law to be applied differently in different areas. We have one law in this country. To apply it differently in different areas is a travesty of the law. We must all bear in mind that the smuggling conduits that exist involve other contraband, not only cigarettes. The only way to address the smuggling is to enforce the law. This is imperative.
Also, nobody speaks about the law-abiding citizens who live on the reserves. What about the effects the illegal activities through the smuggling of contraband has on their lives? Why should we apply the law any differently for them than we apply it to people outside the reserves?
These two efforts by themselves will have a dramatic impact on smuggling. As I said before, the export tax alone had a dramatic effect. There is no need to produce these tax rollbacks that are going to have such a devastating effect on the health of Canadians.
In order to decrease consumption, particularly among teenagers, it is imperative that we bring the cost of cigarettes back up to where it was. As I have said before, this is the number one factor in consumption. If we do what I said before, then we would be honestly imparting knowledge to other countries of which we can truly be proud.
The current rollback in taxes is a large blight on the country's health care system. The other aspect of my motion is to utilize the funds from the taxes to apply to a health care system, a system that is in critical shape and needs emergency care.
Our current health care system is caught between a rock and a hard place. On the one hand we have an increasing demand from an aging population and more expensive technologies, on the other hand we have a system of decreasing funding and squeezing an increasing deficit. If we manage to go ahead and apply this money to our health care system we would be able to give it
an injection of capital that the health care of the people of this country desperately need. Right now the provinces are forced to engage in the deplorable concept of rationing. They are rationing essential health care services-bypass surgery, hip operations, the closure of hospital beds. All these things are occurring and are compromising the health care of Canadians. This past week the head of the Heart Institute here in Ottawa said that the waiting time for bypass surgery is now five months.
If one needs a new hip in this country and are in severe pain, that category of people who are in severe pain, 40 per cent of those individuals will wait at least 13 months to get their hip operation after spending that time in severe pain, a travesty in a country that is as affluent as ours.
Another benefit of raising the taxes on cigarettes is that the moneys can be applied to a public anti-smoking campaign. I advise this government that the greatest impact that it will have on youth is between applying those moneys to an anti-smoking campaign for them between the ages of eight and seventeen, the age at which 90 per cent of the individuals who smoke take up this habit, a habit that is the second most addictive one that we know, more addictive than heroine.
To that end I would like to briefly give members a testimonial from a 13-year old girl who wrote a letter that was actually published in Newsweek :
Right now I am 13 and I am going into ninth grade and started smoking in the sixth. The first cigarette that I ever had was in fifth grade.
I have tried to quit, but it is very hard when all my friends smoke, too.
Some people think that Joe Camel is directed towards teenagers.
She is referring to advertisements.
I do not think so. If they are trying to get it directed towards teenagers, they are doing a pretty bad job. I am sorry, but a goofy looking camel who smokes his brains out does not quite turn me on. Actually, I have never seen an ad that made me want to smoke a particular brand. All those cigarette ads are practically the same.
She is 13. On health she says:
Since I have started smoking I can hardly run around the block without getting out of breath. A lot of my friends have gotten asthma. My mom and dad quit smoking about 14 years ago, and my mom now has cancer and my dad has had three heart attacks. My grandma quit eight years ago, and she has emphysema. Not only that-my two grandfathers died from the results of smoking. After all these problems, you would think I would know better than to smoke. But I guess I do not.
I cannot tell that I smell when I smoke, but my parents and other can. I remember one time, before I smoked, I left my jacket at my friend Brynn's House. Her whole family smoked. I got the jacket back around five months later, and I had to throw it away because it smelled like an ashtray.
It is funny, but I think it is easier to give up drugs than cigarettes.
I really hate the thought of quitting. But yet, I do not want to do anything that might make cigarettes more expensive to buy. You see, I am really hooked on cigarettes.
I would suggest that the government does not emphasize its advertisements on showing a group of yuppy Rosedale teenagers playing basketball and turning into cigarettes. Rather, we have to face the facts that teenagers believe they are immortal. There is another way of dealing with this. It will not work to tell them that they are going to die of lung cancer or mouth cancer 40 years from now because they believe they are immortal.
I feel it would be far more potent to threaten their sense of narcissism. Tell them that their breath smells foul. Tell them that their hair smells foul and tell them that their skin will become pallid.
In conclusion, I hope that this government which promised to bring back the taxes to where they were and has not made any efforts whatsoever to do this will take it in its heart to look at the facts.
Smuggling is under control. It can continue to be under control with the export tax and enforcement. It needs to apply those taxes to the health care and welfare of Canadians. One does not need to keep a tax rollback and compromise the health and welfare of the people of this country and sacrifice smuggling as a result. One can do both without sacrificing the health care of Canadians.