Thank you, Mr. Speaker. Tobacco is bad, period. We all agree that cigarettes contain known carcinogens that cost our health care systems millions of dollars annually. What kills me even more is that I don’t think we’re collecting all our taxes on this product, because I believe we have an open door in the tobacco tax collection process itself that is half open, and this half-open door could be potentially exploited. I will attempt to walk the Members here today down a very complex path in tobacco tax collection.
To start, there are a myriad of terms thrown in the collection of tax for tobacco such as Black Stock Tobacco, Alberta tax memos, tax rebates, tax rebate requests, treasury division, and wholesale dealer permits are just a few terms of the process. Placing all these terms together in a flowchart, you soon have yourself a very convoluted spaghetti chart. As complex as it may be, there is a flaw in this system that is easily identifiable.
The Minister of Finance is aware of this discovery, and I wish to thank him for his patience and his thoroughness with his investigation when I brought it forward. Furthermore, I am more than certain that the Minister will stand here before you today and indicate that all is okay, that hours were spent to obtain adequate evidence to assure that tobacco taxes were being remitted properly to the NWT.
The Minister may be accurate in his assumptions, but to be fair, providing assurances that the total tax revenues being collected are reasonable with the use of national averages for smoking rates are not, in my mind, the numbers we should be trusting. I think the people of the NWT deserve the utmost confidence that our tax collection system is foolproof and without the potential doorway of exploitation. Without the proper physical audits, this assumption with the use of smoking averages is futile.
Simply put, the Alberta tax memos that account for the tax being paid in Alberta are not the area of concern. These are audited and balanced throughout the purchase cycle from wholesaler to retailer. Where things get confusing are the means in which the self-reporting practice occurs for the GNWT tax portion and remittance. Admittedly, this is not an electronic submission but, rather, a manual remittance, hence self-reporting and the potential flaw in the system.
I will have further questions today for the Minister of Finance in asking him how we can close this potential loophole which could be costing the GNWT significant money in lost tax revenues.
Thank you, Mr. Dolynny. The honourable Member for Frame Lake, Ms. Bisaro.
