Canada Tobacco Firms Smuggling Settlement Too Low..

September 17, 2008 - Physicians for a Smoke-Free Canada have asked the federal Auditor General Sheila Fraser to investigate the recent $1.1-billion settlement with Imperial Tobacco and Rothmans Inc. The anti-smoking organization wants Fraser to find out who negotiated the settlement, why it was so low and why no executives were criminally charged.

The physicians calculate that the smuggling-related activities of Imperial Tobacco and Rothmans Inc. during the early 1990s together cheated the Canadian government out of more than $4 billion. Added to this would be interest charges, penalties and fines.

Paul Finlayson, a former executive with Imasco (IMperial ASsociated
COmpanies) -- which was the holding company of Imperial Tobacco -- called the settlement "chump change" and stated that the government "didn't have the guts of a field mouse" to go after the tobacco companies.

In 1994, Canada reduced tobacco taxes in response to concerns about smuggling, causing the real price of cigarettes to fall by one-third. Teenage smoking increased from 16% to 20%. (Tobacco smuggling, Luk Joossens,

Reference: Physicians criticize tobacco agreement by William Marsden, Canwest News Service, 9/12/2008.

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