The market for smuggled cigarettes in Canada has gone up in smoke after cigarette taxes were drastically cut in February, a government report on cigarette sales says.
Canadian domestic cigarette sales climbed 42.4 percent in March to 4.34 billion from 3.05 billion in February as Canadians who used to buy cigarettes smuggled in primarily from the United States. The smuggled cigarettes were cheaper because they were free of taxes.
When compared to cigarette sales of 2.67 billion in March 1993, domestic sales this year were up 62.5 percent, according to a report by Statistics Canada.
Statistics Canada attributes the decline in cigarette exports to the U.S. after the federal and Quebec governments lowered their cigarette taxes on Feb. 8, followed by New Brunswick two days later and by Ontario two weeks later.