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Federal Tax Increase Good for Gangs, Bad for Small Business

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SOURCE United Korean Chamber of Commerce and Industry Association

MONTREAL, Feb. 18, 2014 /CNW/ - On Tuesday, the federal Conservative government increased taxes on cigarettes by $4,03 a carton. As Canada's provinces have seen, this will drive smokers from stores that sell cigarettes legally and into the contraband tobacco market. 

That is the conclusion of the United Korean Chamber of Commerce and Industry Association (UKCIA). The UKCIA has more than 8,500 members, mostly small, family-run businesses that legally sell cigarettes in Canada. These stores help the government collect taxes and keep cigarettes out of the hands of children by always asking for ID. 

The Association is now concerned that provinces will now use the federal tax increase as an excuse to increase their own cigarette taxes, which would only make the contraband situation worse. 

The UKCIA wants to be clear: unless strong action is taken to fight contraband cigarettes, higher taxes on legal business will only encourage organized crime. They will expand the contraband market, make our communities less safe and put more illegal cigarettes into the hands of our children. 

The UKCIA is pleased to see the federal government's commitment to increase RCMP resources to improve intelligence gathering and technology to better monitor the illegal tobacco trade. But this is not enough - the UKCIA urges the provinces to also increase their anti-contraband efforts. Ontario in particular has yet to follow-through on its commitment to increase its efforts against contraband. All governments need to follow the example of Quebec, which launched a successful effort against contraband in recent years. 

"We saw in Quebec the fight against contraband can work. Stopping illegal cigarettes keeps them out of the hands of our children", stated Bong Sup Lee, President of the United Korean Chamber of Commerce and Industry Association (UKCIA) 

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