When faced with a tax increase on cigarettes, smokers tend to change their habits. According to a study carried out in Ontario, instead of quitting smoking, consumers seem to prefer turning to the black market, which is much less expensive. The study showed that 31% of the cigarettes smoked in Ontario in 2017 were purchased on the black market. Only 25% of cigarettes were smuggled in 2016.
The study, commissioned by the Ontario Merchants Association, which is chaired by David Bryans, was carried out by the WrightOn Field Marketing firm. It holds little scientific value. To find out the true origin of cigarettes, researchers analysed more than 18,000 cigarette butts collected in 135 different locations across 23 regions throughout Ontario
The government is powerless in the face of tobacco contraband
The findings are clear: over one third of cigarettes smoked in Ontario are purchased through the black market. This study corroborated the evidence from another study carried out in Ontario, which stated that 32% of cigarettes smoked in 2017 were smuggled. These findings are even more alarming in the northern cities, such as Brantford, where this year half of all cigarettes come from the black market, compared to 36% in 2016.
David Bryans is worried about the extent of the phenomenon. As of now, he does not believe the government has any solution to combat smuggling. Bryans primarily blames the increase in cigarette taxes, which further widens the gap between a legally purchased pack ($14) and one sold on the black market ($5). North Ontario is a low-income, working class region, and most smokers cannot afford the continued price increase of cigarettes.
Instead of encouraging consumers to quit smoking, the government is indirectly forcing citizens to turn to the black market. Bryans has emphasized a prevention and education program. He has also called on the government to invest in the OPP, an anti-contraband task force group in Ontario.