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June 21, 2021

Does Canada need another cigarette tax hike?

At a time when the HST is right around the corner for millions of Canadians, no one wants to hear about new taxes.

But a breaking story out of New York City is giving life to an age-old tax debate, and the issue doesn’t seem to care of its timing.

Out of the Big Apple today, lawmakers will soon vote on a new cigarette tax of an additional $1.60 per pack, a move that looks likely to make New York the first U.S. city to break the $5 tax hit per pack of smokes.

If the vote goes through, and many expect that it will, a pack of cigarettes in New York City will cost more than $10.

Now, news of this shouldn’t come as a total  surprise to smokers. When money is tight, governments love to target sin taxes as a means to boost their deflated budgets.

But it does bring forth two questions:

1. Is it fair for smokers to continually be forced to shoulder higher taxes when cities/provinces/municipalities need some extra cash?

2. Will such a cigarette tax hike soon come to Canada?

To answer the first question, you have to realize that there really is no answer to the first question. With American cities now under increased pressure to keep their citizens safe – remember, the U.S. health care system has drastically changed in the past six months – it’s little wonder Yankee tax men would aim to pass off the costs of caring for those with cigarette-inflicted health problems to those smokers. That is not rocket science.

And this almost brings us across a bridge to our second question. In Canada, a country with a worldly reputation for its universal health care, smokers are taxed big but – and I’m sure even smokers would admit this – they’re not taxed so high that another hike isn’t likely to soon come down the pipeline. It is, according to many sources, what the public wants.

Smokers in Canada: do you fear another tax hike coming soon?

And non-smokers in Canada: do you think another one needs to come?

By Jason Buckland, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

James HaversJames Havers

James is the senior editor of MSN Money living in Toronto. He has worked for the Nikkei Shimbun (Tokyo),,, Canadian Business and other publications. Havers turned to journalism after teaching overseas.

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...