Buying & Selling Illegal Tobacco
Contraband tobacco is not tolerated in B.C. The province takes enforcement action to combat the underground economy, including contraband tobacco.
Participating in activities associated with illegal or contraband tobacco:
- Threatens tax revenue, reducing support for important government programs such as healthcare, infrastructure and education
- Undermines government efforts to reduce smoking rates and protect minors from the dangers of smoking
- Contributes to health and safety risks due to the lack of oversight of unregulated products
- Compromises public safety by providing funds used to finance organized crime and other criminal activities such as drug and gun trafficking
Contraband tobacco includes:
- Tobacco products that are not properly stamped or marked
- Legal tobacco products that are purchased or sold illegally
Legitimate tobacco follows B.C.’s tobacco marking program (PDF), which states that:
- Packages of cigarettes and fine cut tobacco intended for tax-paid sales in B.C. must have the green B.C. stamp
- Packages of cigarettes and fine cut tobacco intended for tax-exempt sales to First Nations and through duty-free stores (black stock tobacco) only have the federal government’s peach stamp
Cigars, snuff, pipe, chewing and raw leaf tobacco do not require a B.C. mark or stamp but have the federal government’s peach stamp.
Cigarettes and fine cut tobacco that do not follow B.C.’s tobacco marking program are illegal.
Legitimate tobacco has tobacco tax included in the price. For example, the B.C. tobacco tax portion for a carton of cigarettes is $49.40. A carton sold for less than this amount is likely illegal.
Illegal activities involving legal tobacco include:
- Selling tobacco to persons under the age of 19
- Selling any tobacco product without an authorized permit
- Reselling duty-free purchased tobacco
- Selling taxable tobacco products without charging or collecting tobacco tax
- Selling tax-exempt tobacco to customers who are not eligible
- Refer to Sales to First Nations and the Tobacco Tax Exemption Program (PDF) or Exemptions for Members of the Diplomatic and Consular Corps (PDF) to find out who is eligible to purchase tax-exempt tobacco
- Possessing more than 1,000 grams (equivalent of 5 cartons) of tobacco if you are a consumer
- Importing tobacco without paying tobacco tax
- Visit Canada Border Services for more information on declaring tobacco when crossing the border
- Selling imported tobacco declared for personal use
For more details on illegal tobacco activities, refer to B.C.'s Tobacco Marking Program (PDF).
Penalties for being involved in illegal tobacco activities include:
- Suspension or cancellation of any tobacco tax permit you may possess
- Forfeiture of your tobacco products
- Fines of 3 times the tobacco tax up to $50,000
- Up to 2 years of imprisonment
B.C. works closely with other federal and provincial jurisdictions to combat contraband tobacco and willful tobacco tax evasion.
B.C. takes enforcement action against contraband tobacco through a dedicated Investigations Unit that:
- Works closely with the RCMP, other policing agencies, Canada Revenue Agency and Canada Border Services Agency as well as provincial counterparts to prevent illegal activity and tax evasion
- Conducts investigations into willful non-compliance and fraud against tax revenues
- Provides training and education to bylaw agencies, police units, health enforcement offices and industry stakeholders on how to prevent occurrences of contraband tobacco
B.C. also combats contraband tobacco through the following initiatives:
- The federal tobacco stamping program with security features and specific B.C. markings, making counterfeit tobacco products more difficult to produce and easier to identify
- A Retail Tobacco Inspection Program to prevent the sale of contraband products in retail outlets
- A toll-free TIPS line where callers can anonymously report the illegal sale and distribution of products and other taxable services