Quebec mulls tobacco-tax hike

Montreal Gazette, 14 January 1999

Jacques Boissinot, CP / Finance Minister Bernard Landry talks about possible boost in cigarette taxes yesterday

The province is mulling a tax hike on tobacco products to discourage teenagers from lighting up, meaning smokers may soon have to pay up to $1.50 more per carton to indulge their cravings.

Specific details of the increase are still being negotiated, but Finance Minister Bernard Landry indicated yesterday there will likely be a modest jump implemented before this spring's provincial budget.

"Is it a possible scenario? Yes. But no final decisions have yet been taken", Landry said. "Our neighbours to the south have raised their taxes, which has reduced the risk of contraband crossing our borders."

A carton of cigarettes costs about $31.40 in Quebec, compared with $46 in Canadian funds in Maine and Vermont.

Still, Landry said, "We have to be careful not to fall into the trap and facilitate smuggling through excessive fiscal measures."

He added there is ample evidence of a link between the price of cigarettes and the number of youth smokers, and said that is an issue that must be addressed.

Feds Seek Consensus

Reports from Ottawa yesterday said the federal government and four eastern provinces have agreed in principle to the $1.50 jump. Quebec was said to be the only holdout.

Landry didn't comment on those reports, saying he will be discussing the matter with his counterparts in the next few weeks.

The announcement was hailed by the Canadian Cancer Society, which has long advocated higher taxes in order to discourage teens from taking up smoking.

"Our studies show that for every 10-per-cent increase in the price of cigarettes, 7 per cent of young smokers quit," said Nicole Mireault, a spokesman for the society's Montreal chapter.

"Obviously, we'd like to see the taxes go up, especially now that the smuggling issue isn't as big a problem."

Officials at the Canadian tobacco manufacturers Council, which represents cigarette-makers, could not be reached for comment.

In 1994, Quebec cut its tariffs, along with Ontario and three Atlantic provinces, in an effort to stamp out international and interprovincial tobacco smuggling.

Landry said the province is poised to act, now that tobacco taxes in Canada and the U.S. have reached similar levels.

Pressure from cancer society: "The cancer society is putting us under considerable pressure to raise these taxes,", Landry admitted. "We are sensitive to their arguments, but we are sensitive to the smuggling issue."

Asked whether he has any advice for smokers, Landry was blunt.

"To quit. Like I did myself 12 years ago. And you can be sure for a former Levesque minister, it wasn't so easy" he quipped.

(The late premier and many in his cabinet were chainsmokers)

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