Good thing western Canadian govts are making aboirignals pay tax on the tobacco they sell. Another good reason to privatise reserves and repealing the Indian Act.
The following is how the Indian Act is being abused and enablers allow it to happen. A corporation owning trucks, using gas, using highways, earning millions of dollars is not a traditional aboriginal right of any sort. Just follow the laws like everyone else has to in Canada.
In a statement of defence, the province acknowledged that Section 87 of the Indian Act "provides certain tax exemptions for the personal property of an Indian person or a band situated on an Indian reserve."
The last line of this story discusses economic "genocide". Very droll.
Case mulls First Nations' tobacco shipping rights
The following is how the Indian Act is being abused and enablers allow it to happen. A corporation owning trucks, using gas, using highways, earning millions of dollars is not a traditional aboriginal right of any sort. Just follow the laws like everyone else has to in Canada.
In a statement of defence, the province acknowledged that Section 87 of the Indian Act "provides certain tax exemptions for the personal property of an Indian person or a band situated on an Indian reserve."
The last line of this story discusses economic "genocide". Very droll.
Case mulls First Nations' tobacco shipping rights
Case mulls First Nations' tobacco shipping rights
By Douglas Quan, Postmedia News January 9, 2012
An aboriginal tobacco company that has thrived in Quebec and Ontario set out last year to begin selling and distributing its cigarettes in First Nations communities across Western Canada.
But from British Columbia to Manitoba, shipment after shipment of Rainbow Tobacco's cigarettes wound up in the hands of authorities because provincial taxes hadn't been paid on them.
The company, located on the Kahnawake reserve near Montreal, insists that as long as its products are distributed within or between aboriginal reserves only federal tax laws should apply. The company and its supporters add that provincial interference is hampering economic development in communities that need it most.
The potentially precedentsetting legal showdown is expected to be closely watched this year by police, provinces and convenience store owners, who say there's no way they can compete with the cheaper smokes.
No doubt, consumers are paying attention, too, said Andrew Lokan, a constitutional and aboriginal-rights lawyer in Toronto.
"There's a segment of the public that's keenly interested whether they can buy cheap cigarettes," he said.
Lokan said there's no predicting which way the case will go as a lot can turn on individual facts.
"It's a complex area of the law," he said.
According to Rainbow Tobacco's website, the cigarette industry is a big employer of Kahnawake Mohawks and is a major reason why unemployment on the reserve has steadily dropped in recent years.
With an eye to creating more jobs, the company started talking in 2010 with First Nations communities in Western Canada about selling and distributing its products. The company says it has been licensed to manufacture and sell finished tobacco products by the Canada Revenue Agency since 2004. (The agency couldn't confirm this, citing privacy reasons).
It didn't take long for the company's westward expansion plans to hit a snag.
In January 2011, officials with the Alberta Gaming and Liquor Commission and the RCMP seized about 75,000 cartons - or about 16 million cigarettes - that had been shipped from Rainbow Tobacco to the Montana First Nation reserve south of Edmonton.
A news release from the province said the "contraband" cigarettes were not properly marked for legal sale in Alberta, in violation of the provincial Tobacco Tax Act, and that the province stood to lose $3 million in tax revenue.
Several individuals were charged for not meeting those tax requirements and for failing to have proper licences to import the cigarettes. They face the possibility of $20,000 fines, sixmonth prison terms or both. None of the charges have been proven in court.
Similar seizures of the company's cigarettes happened over the next several weeks in B.C. and Saskatchewan. And in November, authorities in Manitoba seized Rainbow Tobacco cigarettes from an off-reserve smoke shop run by three Dakota First Nations.
Following the first seizure in Alberta, Rainbow Tobacco and the Montana First Nation filed a lawsuit against the province, stating the cigarettes were marked "Canada - Duty Paid" and that the province lacked authority to seize them.
"The personal property owned by Full Status Indians and located on reserve is exempt from taxation," the suit said.
The suit also claimed that the province's interference hindered economic development of the Montana First Nation and caused Rainbow Tobacco to lose profits.
In a statement of defence, the province acknowledged that Section 87 of the Indian Act "provides certain tax exemptions for the personal property of an Indian person or a band situated on an Indian reserve."
But the province maintained that it "has jurisdiction to investigate and enforce alleged breaches of the (Alberta) Tobacco Tax Act."
The Montana First Nation has since withdrawn from the suit. No hearing dates have been set.
An RCMP criminal intelligence report stated that "the outcome of this case will set a precedent, which will determine the taxation of products that are sold between Native reserves in Canada."
Shin Imai, a law professor at York University in Toronto, said Rainbow Tobacco seems to have a strong case.
"They're (federally) licensed. They paid federal tax. They went from one Indian reserve to another federal Indian reserve. That's all legal. There's nothing wrong with that," he said.
Imai noted that governments give tax breaks to spur growth in the movie and auto industries. A case could be made that the aboriginal tobacco industry could use the same help.
"They start something and everyone jumps on them and says it's contraband. It can get kind of discouraging," he said.
In July, the Assembly of First Nations passed a resolution at its annual general assembly affirming the "inherent and treaty rights" of First Nations to move tobacco across provincial borders without paying provincial taxes.
Attempts to regulate and limit access to tobacco negatively impacts "our ability to maintain our cultures and practices, our spiritual ceremonies, and traditions," the resolution said.
However, the National Coalition Against Contraband Tobacco issued a statement in November saying that smoke shacks that don't comply with federal and provincial regulations make a "mockery" of tobacco control efforts and should be shut down.
Representatives of the Canadian Convenience Store Association have said aboriginal smoke outlets create an uneven playing field.
Robbie Dickson, president of Rainbow Tobacco, couldn't be reached for comment. But in earlier interviews with the Aboriginal Peoples Television Network, Dickson said he has not encountered any interference in Ontario or Quebec.
He said he pays hundreds of thousands of dollars in federal taxes every year and that provincial governments are committing "economic genocide by trying to prevent this endeavour."
By Douglas Quan, Postmedia News January 9, 2012
An aboriginal tobacco company that has thrived in Quebec and Ontario set out last year to begin selling and distributing its cigarettes in First Nations communities across Western Canada.
But from British Columbia to Manitoba, shipment after shipment of Rainbow Tobacco's cigarettes wound up in the hands of authorities because provincial taxes hadn't been paid on them.
The company, located on the Kahnawake reserve near Montreal, insists that as long as its products are distributed within or between aboriginal reserves only federal tax laws should apply. The company and its supporters add that provincial interference is hampering economic development in communities that need it most.
The potentially precedentsetting legal showdown is expected to be closely watched this year by police, provinces and convenience store owners, who say there's no way they can compete with the cheaper smokes.
No doubt, consumers are paying attention, too, said Andrew Lokan, a constitutional and aboriginal-rights lawyer in Toronto.
"There's a segment of the public that's keenly interested whether they can buy cheap cigarettes," he said.
Lokan said there's no predicting which way the case will go as a lot can turn on individual facts.
"It's a complex area of the law," he said.
According to Rainbow Tobacco's website, the cigarette industry is a big employer of Kahnawake Mohawks and is a major reason why unemployment on the reserve has steadily dropped in recent years.
With an eye to creating more jobs, the company started talking in 2010 with First Nations communities in Western Canada about selling and distributing its products. The company says it has been licensed to manufacture and sell finished tobacco products by the Canada Revenue Agency since 2004. (The agency couldn't confirm this, citing privacy reasons).
It didn't take long for the company's westward expansion plans to hit a snag.
In January 2011, officials with the Alberta Gaming and Liquor Commission and the RCMP seized about 75,000 cartons - or about 16 million cigarettes - that had been shipped from Rainbow Tobacco to the Montana First Nation reserve south of Edmonton.
A news release from the province said the "contraband" cigarettes were not properly marked for legal sale in Alberta, in violation of the provincial Tobacco Tax Act, and that the province stood to lose $3 million in tax revenue.
Several individuals were charged for not meeting those tax requirements and for failing to have proper licences to import the cigarettes. They face the possibility of $20,000 fines, sixmonth prison terms or both. None of the charges have been proven in court.
Similar seizures of the company's cigarettes happened over the next several weeks in B.C. and Saskatchewan. And in November, authorities in Manitoba seized Rainbow Tobacco cigarettes from an off-reserve smoke shop run by three Dakota First Nations.
Following the first seizure in Alberta, Rainbow Tobacco and the Montana First Nation filed a lawsuit against the province, stating the cigarettes were marked "Canada - Duty Paid" and that the province lacked authority to seize them.
"The personal property owned by Full Status Indians and located on reserve is exempt from taxation," the suit said.
The suit also claimed that the province's interference hindered economic development of the Montana First Nation and caused Rainbow Tobacco to lose profits.
In a statement of defence, the province acknowledged that Section 87 of the Indian Act "provides certain tax exemptions for the personal property of an Indian person or a band situated on an Indian reserve."
But the province maintained that it "has jurisdiction to investigate and enforce alleged breaches of the (Alberta) Tobacco Tax Act."
The Montana First Nation has since withdrawn from the suit. No hearing dates have been set.
An RCMP criminal intelligence report stated that "the outcome of this case will set a precedent, which will determine the taxation of products that are sold between Native reserves in Canada."
Shin Imai, a law professor at York University in Toronto, said Rainbow Tobacco seems to have a strong case.
"They're (federally) licensed. They paid federal tax. They went from one Indian reserve to another federal Indian reserve. That's all legal. There's nothing wrong with that," he said.
Imai noted that governments give tax breaks to spur growth in the movie and auto industries. A case could be made that the aboriginal tobacco industry could use the same help.
"They start something and everyone jumps on them and says it's contraband. It can get kind of discouraging," he said.
In July, the Assembly of First Nations passed a resolution at its annual general assembly affirming the "inherent and treaty rights" of First Nations to move tobacco across provincial borders without paying provincial taxes.
Attempts to regulate and limit access to tobacco negatively impacts "our ability to maintain our cultures and practices, our spiritual ceremonies, and traditions," the resolution said.
However, the National Coalition Against Contraband Tobacco issued a statement in November saying that smoke shacks that don't comply with federal and provincial regulations make a "mockery" of tobacco control efforts and should be shut down.
Representatives of the Canadian Convenience Store Association have said aboriginal smoke outlets create an uneven playing field.
Robbie Dickson, president of Rainbow Tobacco, couldn't be reached for comment. But in earlier interviews with the Aboriginal Peoples Television Network, Dickson said he has not encountered any interference in Ontario or Quebec.
He said he pays hundreds of thousands of dollars in federal taxes every year and that provincial governments are committing "economic genocide by trying to prevent this endeavour."
