JTI-Macdonald Corp. Launches Campaign to Show That Plain Packaging Doesn’t Work and Will Help Organized Crime

• Campaign aims to highlight to Canadians and the Government that plain packaging doesn't work
• Plain packaging will increase unregulated and untested illegal tobacco, fuelling organized crime and massive loss of tax revenue
• Nine out of ten Canadians had either never even heard of the public consultation or couldn’t explain what it was about.

MISSISSAUGA, Ontario--(BUSINESS WIRE)--On the heels of the federal government’s consultation on plain packaging for tobacco products, JTI-Macdonald Corp. has launched an awareness campaign to highlight to Canadians and the government the perils of such a move.

The online and mainstream media campaign underlines the failed experience from Australia where plain packaging was introduced in 2012 and had unintended consequences (https://www.BothSidesoftheArgument.ca). More specifically, the campaign addresses the potential impact of the measure on Canadians, including:

• the rise in unregulated and untested tobacco products sold by criminal gangs at discount prices available to minors;
• the tax revenue loss due to the surge in illegal tobacco availability and sale; and
• the domino effect on fast food, sugary drinks and alcohol.

According to the Royal Canadian Mounted Police (RCMP), 175 organized crime groups already sell illegal tobacco across Canada and use the profits to fund their other crimes such as weapons and drugs trafficking.¹ Almost 20% of the Canadian tobacco market is already illegal and deprives governments of $1.6 billion in tax revenue each year.² After Australia implemented plain packaging, illegal sales rose by 21%.³ If the same happens here, it will cost Canadian taxpayers an additional $330 million for a total of almost $2 billion per year.

JTI commissioned Forum Research to conduct a poll to understand Canadians’ views on the plain packaging proposal and consultation process. Forum found that 9 out of 10 Canadians had never even heard about the public consultation and most do not think that plain packaging is necessary or a good use of government resources.

“Plain packaging simply doesn't work and will make it easier for criminals to sell cheap, illegal tobacco," says Igor Dzaja, General Manager of JTI-Macdonald Corp. “Canadians expect policy that is evidence-based and that will achieve its aims, not regulation that is rushed through without reliable evidence it will work or consideration of the negative consequences, including for other consumer goods businesses who are bound to be next.”

About JTI-Macdonald Corp.:

Founded in 1858, JTI-Macdonald Corp. employs more than 500 people. The Company has manufacturing facilities in Montreal, administrative offices in Mississauga and sales offices across the country. In 2015, for the eleventh year, JTI-Macdonald Corp. was ranked among the 50 Best Companies to Work for in Canada, as compiled by Aon Hewitt.

¹ Superintendent Joe Oliver (Director General, Border Integrity, RCMP), House of Commons Standing Committee on Public Safety, April 27 2010.

² Christian Leuprecht (Macdonald-Laurier Institute Publication), “Smoking Gun: Strategic Containment of Contraband Tobacco and Cigarette Trafficking in Canada”, March 2016.

³ KPMG, “Illicit Tobacco in Australia: 2015 Full Year Report”, April 2016.