Why Tobacco Should Remain Legal in Canada

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Executive Summary

Tobacco is a very large industry in Canada, providing very large tax revenue for the Canadian government. This paper examines the two sides to the argument; should Tobacco be made illegal in Canada? Is smoking tobacco ruining the Canadian economy? Or should Canadians be given the freedom to chose, and current rulings upheld? In 2005 Revenues for the government in direct taxation on tobacco amounted to $7.7 Billion. That level has nearly doubled since 2001 when only $4.4 Billion had been collected in tax. The industry also employs a large segment of the workforce; there are currently 4000 people directly employed by tobacco industries, and an estimated 16,000 directly employed in the industry. Smoking is so much a habit for many, that if it were made illegal, it is almost certain that it would become an underground act, which studies prove will cause an increase in crime. Donations for sporting events also are lost, and the result is smaller functions that have less funding and lower turnouts. Overall Canada is deemed a free country, smoking is deeply ingrained in many national cultures, and illegalizing smoking would lead to an infringement of the freedom to choose. The negative impacts of smoking, such as the detriment to individual health as well as the Health Care system are also looked into. Estimates place the cost of smoking to $24 Billion Annually and that each pack of cigarettes cost the economy $11 in health care and lost productivity. Taking all these considerations the conclusion is met that for the long term benefit of the Canadian economy, smoking tobacco should not be made illegal. Introduction on Why Tobacco Should Remain Legal

One reason that tobacco growing, processing, and selling should remain legal is for the collection of taxes.
Taxes from tobacco products sold in Canada provide a very liberal revenue stream for the government, economy, and therefore the general public. The taxes collected can be used to fund various public services such as education, health care, or roads. Last year the average amount of taxes paid on a pack of cigarettes across the provinces in Canada was $6.72. Last year the government collected almost $7.7 billion in tobacco taxes, which has been climbing up constantly since 2001 where $4.4 billion in taxes was collected which can be seen in the table below. So by making tobacco illegal, the Canadian economy would lose this valuable revenue (Physicians).

Figure 1

Another reason to keep the tobacco industry in Canada legal is to keep people employed.
By making tobacco illegal there would be a loss of many jobs. Currently, the tobacco industry in Canada employs about 4000 people directly (Tobacco), however, it is said that for every one person employed by the tobacco industry, there are four others jobs created in the economy (Jones). There are those involved in the distribution of the products, those involved in the logistics of getting the product to those involved in the wholesale and retail of the products. There are also those involved in the actual agriculture of tobacco. There are currently 1326 tobacco farms in Canada who employ workers, so if tobacco becomes illegal, all of these people will lose their jobs, resulting in higher unemployment and damaging the economy.

Also, if tobacco were made illegal, it would only force smokers underground. Since nicotine is addictive, those who are hooked can't just stop smoking, it's very difficult. There are also those who just don't want to stop. So, previously law abiding citizens would start growing their own tobacco to get their fix. Gangs would become involved in illegally selling cigarettes, growing tobacco (possibly low grade), and smuggling tobacco into and out of the country, all resulting in an increase of crime (Powley & Harris). Along with the increase in crime would come an increase in prosecution costs. There would need to be more policing and more border patrol to counteract the...
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