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Imperial Tobacco Canada stated today that Ontario's lawmakers should take a stand against the rampant sales of illegal tobacco in Ontario rather than adopting politically expedient legislation such as the Tobacco Damages and Health Care Costs Recovery Act when they return to Queen's Park this week.

"The Government of Ontario cannot claim that this legislation has anything to do with public health when they are ignoring half the market. Illegal tobacco accounts for close to 50 per cent of tobacco purchases in Ontario - the most in Canada," said Benjamin Kemball, president and CEO of Imperial Tobacco Canada. "It is hypocritical that the Government of Ontario turns around and sues a legal industry that they oversee and license while it allows an illegal tobacco industry to flourish."

The illegal tobacco trade is robbing Canadians of government revenue, undermining tobacco control initiatives, exposing children to cheap cigarettes and allowing organized crime to cash in all the way to the bank.

In 2008, the federal and provincial governments together lost approximately $2.4 billion in taxes and that number is growing as the sale of illegal cigarettes grows. The federal government's share was $1.1 billion. In December, the Ontario Auditor General reported that the estimated tax loss for Ontario in 2006-2007 was $500 million. Imperial Tobacco Canada believes it could be much more than that considering the doubling of the illegal market in Ontario in the past two years.

"This legislation is simply a cash grab. If the government is looking for money, it would be far better to deal with the illegal market than enter into years of legal wrangling that will not result in the monetary windfall the government is hoping for," said Mr. Kemball. "It is time for a government to take a stand. We expect that the Government of Ontario will include the illegal manufacturers in any lawsuit it may bring forward." Governments across Canada collected approximately $7.3 billion in taxes from the tobacco industry in the fiscal year 2008; the province of Ontario collected over $1.2 billion.

Imperial Tobacco Canada believes that if Ontario moves forward with a lawsuit, it will take years to resolve and will cost Ontario taxpayers millions of dollars. A similar action in British Columbia has cost BC tens of millions of dollars and it is still not over.

Further information on Imperial Tobacco Canada is available on the Internet at: www.imperialtobaccocanada.com.