WINNIPEG – A convenience store lobby group is warning that aboriginal “smoke shacks” are set to mushroom across the Prairies unless governments take swift action to shut them down.
“We’ve lived with the situation of smoke shacks and contraband tobacco in Quebec and Ontario for the past six years now,” Michel Gadbois, vice-president of the Canadian Convenience Stores Association, said Monday.
“We have seen the situation where teenagers become resellers of the products in school and make between, what we gather from the RCMP, $1,000 to $1,500 a week.”
Gadbois called on the provincial government to crack down on Dakota Chundee Smoke Shop, which opened last month near Pipestone, Man. Police have twice seized tobacco products from there and have said charges are pending.
Gadbois wants the province to do more: fine customers, shut down wholesalers who supply the store and increase police surveillance of trucks along a nearby highway.
The NDP government is eyeing further measures, a spokesperson said Monday.
“The province continues to monitor the situation at the Dakota Chundee Smoke shop and expects Manitobans to follow the rules as set out in the Manitoba Tobacco Tax Act,” Jodee Mason in Attorney General Andrew Swan’s office wrote in an email.
Mason pointed to provisions under the act that allow for fines of up to $5,000 for people who buy or possess contraband tobacco.
Smoke shacks, where cigarettes are sold at deep discounts without provincial sales taxes, are few and far between in Western Canada, but that may soon change.
Rainbow Tobacco GP, a tobacco company based on the Kahnawake reserve in Quebec, has taken steps to ship tobacco in large quantities to the Prairies. Company president Robbie Dickson has been quoted in media reports as saying he was looking westward to expand.
In January, the Alberta government charged Dickson after police seized 16 million cigarettes from a Quonset hut belonging to the Montana First Nation south of Edmonton.
Rainbow Tobacco is federally licensed and its products bear a federal excise stamp, but police allege the tobacco seized in Alberta was not licensed for sale by the provincial government.
Rainbow Tobacco says it is not bound by provincial law and is challenging the Alberta seizure in court.
One of the owners of the Dakota Chundee store, Chief Frank Brown of the Canupawakpa First Nation, has said provincial tobacco laws do not apply to his outlet.
Brown could not be reached for comment Monday. He has previously said the smoke shop would raise money needed to address a housing shortage and water-quality problems in his community of 600 people.
Convenience store owners say aboriginal outlets create an uneven playing field. Because they do not charge provincial taxes, they can sell cigarette cartons at less than half price.
“In the past three years, 2,500 or more retailers (in Ontario and Quebec) have closed because of that,” Gadbois said.
They also open the door to organized crime because cigarettes can be taken by car or truck into surrounding towns and sold on the black market, he added.
Comments