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Excise Act, 2001 (S.C. 2002, c. 22)

Full Document:  

Act current to 2022-07-25 and last amended on 2022-06-30. Previous Versions

PART 3Tobacco (continued)

Regulation of Tobacco (continued)

Marginal note:Unlawful possession or sale of tobacco products

  •  (1) No person shall sell, offer for sale or have in their possession a tobacco product unless it is stamped.

  • Marginal note:Exceptions — possession

    (2) Subsection (1) does not apply to the possession of a tobacco product by

    • (a) a tobacco licensee at the place of manufacture of the product;

    • (a.1) in the case of manufactured tobacco or cigars, a tobacco licensee who manufactured the tobacco or cigars, at their excise warehouse;

    • (b) in the case of cigars or imported manufactured tobacco, an excise warehouse licensee at the excise warehouse of the licensee;

    • (c) in the case of manufactured tobacco or cigars, a special excise warehouse licensee at the special excise warehouse of the licensee, if the licensee is permitted under this Act to distribute the tobacco or cigars;

    • (d) in the case of an imported tobacco product, a prescribed person who is transporting the product under prescribed circumstances and conditions;

    • (d.1) in the case of manufactured tobacco or cigars manufactured in Canada, a prescribed person who is transporting the tobacco or cigars under prescribed circumstances and conditions;

    • (e) in the case of an imported tobacco product, a sufferance warehouse licensee in their sufferance warehouse;

    • (e.1) in the case of imported manufactured tobacco or cigars, a customs bonded warehouse licensee in their customs bonded warehouse;

    • (f) in the case of cigars, a duty free shop licensee in their duty free shop;

    • (g) in the case of imported manufactured tobacco, a duty free shop licensee in their duty free shop if the licensee holds a licence issued under section 22;

    • (h) in the case of manufactured tobacco or cigars, an accredited representative for their personal or official use;

    • (i) in the case of cigars or imported manufactured tobacco, a person as ships’ stores if the acquisition and possession of the product by that person are in accordance with the Ships’ Stores Regulations;

    • (j) an individual who has imported the product for their personal use in quantities not in excess of prescribed limits; or

    • (k) in the case of manufactured tobacco or cigars, an individual who has manufactured the tobacco or cigars in accordance with subsection 25(3).

  • Marginal note:Exceptions — sale or offer for sale

    (3) Subsection (1) does not apply where

    • (a) a tobacco licensee sells or offers to sell manufactured tobacco or cigars that are exported by the licensee in accordance with this Act;

    • (b) a tobacco licensee sells or offers to sell

      • (i) manufactured tobacco or cigars to a special excise warehouse licensee, if the special excise warehouse licensee is permitted under this Act to distribute the tobacco or cigars,

      • (ii) manufactured tobacco or cigars to an accredited representative for their personal or official use,

      • (iii) cigars to an excise warehouse licensee for delivery as ships’ stores in accordance with the Ships’ Stores Regulations,

      • (iv) cigars to a duty free shop for sale or offer for sale in accordance with the Customs Act, or

      • (v) cigars as ships’ stores in accordance with the Ships’ Stores Regulations;

    • (c) a special excise warehouse licensee sells or offers to sell manufactured tobacco or cigars to an accredited representative for their personal or official use, if the licensee is permitted under this Act to distribute the tobacco or cigars;

    • (d) an excise warehouse licensee sells or offers to sell

      • (i) imported manufactured tobacco or cigars that are exported by the licensee in accordance with this Act,

      • (ii) imported manufactured tobacco or cigars to an accredited representative for their personal or official use or to a duty free shop, or

      • (iii) cigars or imported manufactured tobacco as ships’ stores in accordance with the Ships’ Stores Regulations;

    • (e) a duty free shop licensee sells or offers to sell cigars in accordance with the Customs Act;

    • (f) a duty free shop licensee who holds a licence issued under section 22 sells or offers to sell imported manufactured tobacco in accordance with the Customs Act;

    • (g) a customs bonded warehouse licensee sells or offers to sell imported manufactured tobacco or cigars that are exported by the licensee in accordance with this Act;

    • (h) a customs bonded warehouse licensee sells or offers to sell imported manufactured tobacco or cigars

      • (i) to an accredited representative for their personal or official use,

      • (ii) to a duty free shop for sale or offer for sale in accordance with the Customs Act, or

      • (iii) as ships’ stores in accordance with the Ships’ Stores Regulations; and

    • (i) a person sells or offers for sale cigars or imported manufactured tobacco as ships’ stores in accordance with the Ships’ Stores Regulations.

  • 2002, c. 22, s. 32
  • 2007, c. 18, s. 79

Marginal note:Prohibition — possession of tobacco manufacturing equipment

  •  (1) No person shall possess tobacco manufacturing equipment with the intent of manufacturing a tobacco product unless

    • (a) the person is a tobacco licensee; or

    • (b) the person is an individual manufacturing manufactured tobacco or cigars for their personal use as permitted under subsection 25(3).

  • Marginal note:Prohibition — importation of tobacco manufacturing equipment

    (2) No person shall import tobacco manufacturing equipment unless

    • (a) the person is a tobacco licensee;

    • (b) the equipment is designed for use by an individual manufacturing manufactured tobacco or cigars for their personal use as permitted under subsection 25(3) and is not designed for commercial manufacturing;

    • (c) the person provides evidence satisfactory to the Minister of Public Safety and Emergency Preparedness that the equipment is imported

      • (i) on a tobacco licensee’s behalf,

      • (ii) for the sole purpose of maintenance, alteration or repair in Canada, if the equipment is intended to be exported immediately after the maintenance, alteration or repair is completed,

      • (iii) by or on behalf of a person who carries on a business of supplying that equipment, or

      • (iv) for in-transit movement through Canada; or

    • (d) it is imported in prescribed circumstances or under prescribed terms and conditions.

  • 2008, c. 28, s. 53

Marginal note:No sale or distribution except in original package

 No person shall

  • (a) sell or offer for sale cigars otherwise than in or from the original package;

  • (b) sell or offer for sale manufactured tobacco otherwise than in the original package; or

  • (c) distribute free of charge for advertising purposes any tobacco product otherwise than in or from the original package.

Marginal note:Packaging and stamping of tobacco

 A tobacco licensee who manufactures a tobacco product shall not enter the tobacco product into the duty-paid market unless

  • (a) the product has been packaged by the licensee;

  • (b) the package has printed on it prescribed information; and

  • (c) the product is stamped at the time of packaging.

Marginal note:Packaging and stamping of imported tobacco

  •  (1) If a tobacco product or raw leaf tobacco is imported, it must, before it is released under the Customs Act for entry into the duty-paid market,

    • (a) be packaged in a package that has printed on it prescribed information; and

    • (b) be stamped.

  • Marginal note:Exception for certain importations

    (2) Subsection (1) does not apply to

    • (a) partially manufactured tobacco that is imported by a tobacco licensee for further manufacturing by the licensee;

    • (b) manufactured tobacco or cigars that a tobacco licensee is authorized to import under subsection 41(2);

    • (c) a tobacco product that is imported by an individual for their personal use in quantities not in excess of prescribed limits; or

    • (d) raw leaf tobacco that is imported by a tobacco licensee or a licensed tobacco dealer.

  • 2002, c. 22, s. 35
  • 2007, c. 18, s. 80

Marginal note:Absence of stamping — notice

 The absence of stamping on a tobacco product is notice to all persons that duty has not been paid on the product.

Marginal note:Unstamped products to be warehoused

 If manufactured tobacco or cigars manufactured in Canada are not stamped by a tobacco licensee, the tobacco licensee shall immediately enter the tobacco or cigars into the licensee’s excise warehouse.

  • 2002, c. 22, s. 37
  • 2007, c. 18, s. 81

Marginal note:No warehousing of tobacco without markings

  •  (1) Subject to subsections (3) and (4), no person shall enter into an excise warehouse a container of manufactured tobacco or cigars unless the container has printed on it or affixed to it tobacco markings and other prescribed information.

  • Marginal note:No delivery of imported tobacco without markings

    (2) Subject to subsections (2.1) and (3), no person shall deliver a container of imported manufactured tobacco or cigars that does not have printed on it or affixed to it tobacco markings and other prescribed information to

    • (a) a duty free shop for sale or offer for sale in accordance with the Customs Act;

    • (b) an accredited representative; or

    • (c) a customs bonded warehouse.

  • Marginal note:Delivery of imported stamped tobacco

    (2.1) A container of imported manufactured tobacco that was manufactured outside Canada and is stamped may be delivered to

    • (a) a duty free shop for sale or offer for sale in accordance with the Customs Act; or

    • (b) a customs bonded warehouse.

  • Marginal note:Exception for prescribed manufactured tobacco

    (3) A container of manufactured tobacco does not require tobacco markings to be printed on or affixed to it if the brand of the tobacco is not commonly sold in Canada and is prescribed.

  • Marginal note:Exception for prescribed cigarettes

    (4) A container of cigarettes does not require tobacco markings to be printed on or affixed to it if the cigarettes are of a particular type or formulation manufactured in Canada and exported under a brand that is also applied to cigarettes of a different type or formulation that are manufactured and sold in Canada and

    • (a) cigarettes of the particular type or formulation exported under that brand are prescribed cigarettes; and

    • (b) cigarettes of the particular type or formulation have never been sold in Canada under that brand or any other brand.

  • Marginal note:Distinguishing different cigarettes

    (5) For the purpose of subsection (4), a cigarette of a particular type or formulation sold under a brand may be considered to be different from another cigarette sold under that brand if it is reasonable to consider them to be different having regard to their physical characteristics before and during consumption.

  • 2002, c. 22, s. 38
  • 2007, c. 18, s. 82
  • 2008, c. 28, s. 54

Marginal note:Non-compliant imports

 If an imported tobacco product or imported raw leaf tobacco intended for the duty-paid market is not stamped when it is reported under the Customs Act, it shall be placed in a sufferance warehouse for the purpose of being stamped.

Marginal note:Removal of raw leaf tobacco or waste tobacco

  •  (1) No person other than a tobacco licensee shall remove raw leaf tobacco or tobacco that is waste from the premises of the licensee.

  • Marginal note:Removal requirements

    (2) If raw leaf tobacco or tobacco that is waste is removed from the premises of a tobacco licensee, the licensee shall deal with the tobacco in the manner authorized by the Minister.

Marginal note:Re-working or destruction of tobacco

  •  (1) A tobacco licensee may re-work or destroy a tobacco product in the manner authorized by the Minister.

  • Marginal note:Importation for re-working or destruction

    (2) The Minister may authorize a tobacco licensee to import any manufactured tobacco or cigars manufactured in Canada by the licensee for re-working or destruction by the licensee in accordance with subsection (1).

  • 2002, c. 22, s. 41
  • 2007, c. 18, s. 83

Duty on Tobacco

Marginal note:Imposition

  •  (1) Duty is imposed on tobacco products manufactured in Canada or imported and on imported raw leaf tobacco at the rates set out in Schedule 1 and is payable

    • (a) in the case of tobacco products manufactured in Canada, by the tobacco licensee who manufactured the tobacco products, at the time they are packaged; and

    • (b) in the case of imported tobacco products or raw leaf tobacco, by the importer, owner or other person who is liable under the Customs Act to pay duty levied under section 20 of the Customs Tariff or who would be liable to pay that duty on the tobacco or products if they were subject to that duty.

  • Marginal note:Imported partially manufactured tobacco

    (2) The following rules apply to partially manufactured tobacco that is imported by a tobacco licensee for further manufacture:

    • (a) for the purposes of this Act, the tobacco is deemed to be manufactured in Canada by the licensee; and

    • (b) paragraph (1)(a) applies to the tobacco and paragraph (1)(b) and section 44 do not apply.

  • 2002, c. 22, s. 42
  • 2014, c. 20, s. 62(F)

Marginal note:Additional duty on cigars

 In addition to the duty imposed under section 42, duty is imposed on cigars at the rates set out in Schedule 2 and is payable

  • (a) in the case of cigars manufactured and sold in Canada, by the tobacco licensee who manufactured the cigars, at the time of their delivery to a purchaser; and

  • (b) in the case of imported cigars, by the importer, owner or other person who is liable under the Customs Act to pay duty levied under section 20 of the Customs Tariff or who would be liable to pay that duty on the cigars if they were subject to that duty.

  • 2002, c. 22, s. 43
  • 2014, c. 20, s. 63(F)
 
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