New tobacco rules in Canada

New tobacco rules in Canada

Smokers will soon see their cigarette packs stripped of logos and distinctive designs.

The cigarette and tobacco manufacturing industry in Canada has flourished despite having to contend with tough regulatory pressures, taxation, and declining consumption levels.

The government has increased excise taxes several times over the past five years in an effort to curb smoking by forcing industry operators to increase prices to salvage profitability. This strategy has been successful as cigarette consumption has declined during the period to the detriment of the industry. However, as a result of tobacco’s inelastic demand, industry operators have been able to increase prices at a faster rate than the decline in demand.

Plain-packaged cigarettes have started to pop up on shelves as the tobacco industry prepares for Health Canada’s regulations to take effect on Nov. 9, after which retailers will have a 90-day window to offload their remaining inventory.

All packaging will feature the same brown base color, basic grey text, and minimalist layout under the new requirements. The measures will also standardize the size and appearance of cigarettes, cigars, and other products inside the packages.

The Canadian tobacco market is segmented between Tobacco Canada (49%), Rothmans, Benson and Hedges (37%), and JTI-MacDonald (13%). In 2015, those three companies made a combined $23.4 billion in profits.

Health experts and advocates say the policy positions Canada at the forefront of a global push to curb the appeal of cigarette brands, particularly among youth, and eliminate packages as pocket-sized promotions for Big Tobacco.

Rob Cunningham, a senior policy analyst at the Canadian Cancer Society, lauded Canada’s plain-packaging regulations as “the best in the world,” having learned from the examples of at least 13 other countries that have adopted similar measures.

Cunningham adds that Canada is leading the charge in eliminating extra-long and “slim” cigarettes, which tend to be marketed to women.

In 2021, slide-and-shell packages will become mandatory in Canada, providing a wider surface area that will display the largest health warnings in the world, he said.

Jeff Gaulin, director of External Affairs at Rothmans, Benson & Hedges, said the company has been working to ensure that retailers are aware of the changes by updating the names in its ordering system months in advance, as well as setting up a website for consumers to find out what products will be affected.

“The package designs (are) really amazingly glitzy and very attractive, especially to kids,” said Fong, the founder and chief principal investigator of the International Tobacco Control Policy Evaluation Project.

In his own research, Fong found that less than 29% of Canadian smokers were in favor of plain packaging–a lower level of support than any other “endgame” tobacco measure tested in the 2016 survey.


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