Webinar: Industry Technical Briefing on the Tobacco Charges Regulations – June 11, 2025

Subject(s)

A webinar was held for tobacco industry stakeholders at the invitation of Health Canada to clarify requirements under the Tobacco Charges Regulations.

Date

June 11, 2025

Participants

Tobacco Control Directorate (TCD) presenters

• Acting Manager (Chair), Cost Recovery, Office of Policy and Strategic Planning
• Manager, Scientific Regulations Division, Office of Compliance and Regulatory Affairs (OCRA)
• Regulatory Affairs Specialist, Scientific Regulations Division, OCRA

Industry representatives

• Katherine Ridings, Regulatory Compliance Supervisor Canada, Rothmans, Benson & Hedges, Inc.
• Brittney Green, Regulatory Affairs Manager, JTI Macdonald Corp.
• Kassandra Richards, Director of Operations, Anzar Consultants Inc.
• Meshaila Sinnis, Director of Corporate Affairs, Anzar Consultants Inc.
• Kyle Wilcox, General Manager, Brigham Enterprises Inc.
• Daniel More, President, Brigham Enterprises Inc.
• Maxime Gaumond, Canada Finance Leader, Scandinavian Tobacco Group Canada Inc.
• Guy Marinteau, Accountant, Scandinavian Tobacco Group Canada Inc.
• Anne Ricard, Director of Production, Bastos of Canada
• Véronique Fleury, Regulatory Reporting Executive, Imperial Tobacco Canada
• Steve Lamont, Senior Regulatory Counsel, Imperial Tobacco Canada
• Timothy O'Hara, Corporate Finance Controller - Planning and Reporting, Imperial Tobacco Canada
• Richard Edelstein, President, Century Tobacco Company
• Colm O'Shea, Executive Vice President/Owner, House of Horvath
• Nelson Ferreira, Accounting Manager, House of Horvath
• Diane Meulemeester, General Manager & Co-Owner, North Shore Tobacco Canada Inc.
• Domenic Ferlisi, Finance, Distribution GVA Inc.
• Tammie Snider, Purchasing Director, Grand River Enterprises
• Jasmine Odlin, Director of External Affairs, Nuvona

Introduction

A webinar was held at the invitation of Health Canada (HC) on the Tobacco Charges Regulations (TCR).

HC read the openness transparency statement, reminding industry representatives that the meeting is subject to disclosure as per HC's Openness and Transparency policies. The handling of information and privacy notice was outlined and acknowledged.

HC also referred to Article 5.3 of the World Health Organization Framework Convention on Tobacco Control, its international obligation to protect tobacco control policies from the vested interests of the tobacco industry.

Participants were also informed of this policy in the invitation, and accepted these terms by registering for the event.

Subjects

TCD welcomed participants and stated that the objective of this technical briefing is to provide an overview of the TCR, which came into force on May 1, 2025, and the statement of sales and revenue. The session focused on outlining the regulatory obligations under the TCR, including the annual charge calculation, submission of statements and compliance requirements.

TCD explained that the objective of the TCR is to require designated tobacco product manufacturers, which includes importers, to pay an annual charge to recover the costs of the tobacco-related activities undertaken by the Government of Canada in relation to the carrying out of the purpose of the Tobacco and Vaping Products Act (TVPA).

Following the presentation, participants were given the opportunity to ask questions. The following key themes summarize the main areas of interest and clarification:

1. Invoicing and Payment Processes

   HC confirmed that it would be directly issuing invoices as well as collecting payments. Designated manufacturers with a domestic tobacco total net sales revenue market share of less than 0.001% for the previous fiscal year will not be required to pay an annual charge. The first statements of sales and revenue for the 2025-26 fiscal year are due from designated manufacturers by April 30, 2026, with the first payments due in full by November 30, 2026.

2. Who Is Required to Pay

   The annual charge will be required to be paid by each entity in Canada that manufactures or imports tobacco products for retail sale in Canada. This does not include entities that only package, label, or distribute tobacco products, including those that do a combination of these activities.

3. Calculation of Annual Charges

   The annual charge calculated for each designated manufacturer is proportionate to their domestic market share in the previous fiscal year (from April 1 to March 31). Some companies raised concerns about fairness for higher-priced products, such as cigars.

4. Transparency and Oversight

   The total costs to the industry are estimated to be $298.8 million in present value over 10 years, or $42.54 million in annualized value. This amount is dependent on the annual cost base, which will be calculated each year based on actual federal government costs for included tobacco-related expenses in the previous fiscal year. Therefore, this amount is expected to vary from year to year to reflect actual costs. The public disclosure provision will come into force in April 2028 with the first public disclosure occurring on or before November 30, 2028.

5. Compliance and Enforcement

   HC stated that the department has various tools to encourage compliance and indicated that an industry guidance document would be published to provide an overview of the tobacco cost recovery framework and key information needed to comply with the framework.

6. Future Frameworks

   HC is pursuing a phased approach to the implementation of tobacco and vaping cost recovery frameworks. Any approach to vaping cost recovery would require further analysis.

7. Scope of Cost Recovery

   The activities for tobacco cost recovery include certain tobacco-related activities undertaken by HC, the Public Health Agency of Canada, and Indigenous Services Canada related to the carrying out of the purpose of the TVPA. A generalized list of included activities can be found in the Regulatory Impact Analysis Statement that was published with the Tobacco Charges Regulations in the Canada Gazette, Part II. A more complete list can be found in Annex 2 of the proposal document that was published for consultation in August 2024.

In closing, the Chair thanked participants for their time and their questions, and indicated that additional questions could be submitted in writing.

Conclusion

The webinar was then concluded.

Documents

• Presentation as prepared by TCD