The National Coalition Against Contraband Tobacco wound its provincial tour to a close in Cornwall Thursday night with the message that the illicit tobacco trade is killing communities by destroying its tax base, health standards and funding organized crime.
"The Auditor General (of Ontario) says the province is losing half a billion dollars in tax revenue to the contraband tobacco trade, but we think it's more like $1 billion," said Steve Tennant, vice-president of the Canadian Convenience Stores Association.
Millions of unstamped, untested and unregulated cigarettes flood across the border each year - 90 per cent of which is estimated to be smuggled through the Cornwall crossing - without anyone paying the required $45 in federal and provincial tax, which enables the ringleaders of the smuggling operations to sell the cigarettes for as little as $6 a carton instead of more than $50.
That's at least $500 million in taxes that won't be available to fund the province's health-care system, and infrastructure such as roads, water and sewage systems, according to Tennant.
The sale of contraband tobacco also undermines small business attempts to make a living legitimately by adhering to the laws around cigarette sales, he said.
Tennant implored the crowd assembled at the meeting to contact their MPP and MP to pressure them to bring the contraband tobacco issue to Parliament Hill and Queen's Park and work towards more action to snuff out the trade.
RCMP Sgt. Michael Harvey explained how the accessibility and low price of the contraband cigarettes to youths makes them very attractive, but stressed that Health Canada has found the contraband product is even worse for their health than regulated cigarettes because they are not monitored for quality at all. Harvey added that the proceeds from their sale often support organized crime.
He said the RCMP has identified 42 organized crime rings in the Cornwall-Valleyfield area which used contraband cigarette sales to finance weapons and drug trafficking.
Hank Cook was making $300,000 a week through such an operation until a multi-jurisdictional police initiative called Project Crawler led to his conviction.
The cigarettes smuggled and sold by the likes of Cook and his employees come from 11 of 12 manufacturers found in the Akwesasne Mohawk territory in New York State. Only one of those manufacturers produces legitimate cigarettes, according to Harvey.
"People think they aren't hurting anyone by buying contraband cigarettes, but they are financing illicit activities such as the drug and gun trade," Harvey said.
Harvey pointed out that there are many youths who can't resist the promise of making $1,000 a day by driving vehicles filled with thousands of cigarettes or fine-cut tobacco for processing into Canada.