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November 1, 2001
For immediate release

Province Joins Federal Government and Other Provinces in Raising Tobacco Tax

Provincial Treasury

Provincial Treasurer Patricia Mella announced this evening that the provincial Health Tax on tobacco will be increased at midnight by 1 cent per cigarette or $2 per carton of 200 cigarettes. This increase is part of a coordinated measure by the federal government and the provinces of Quebec, Ontario, New Brunswick, Prince Edward Island and Nova Scotia to help curb smoking.

"The main reason for increasing the price of cigarettes is to discourage smoking, especially to discourage younger Islanders from taking up this harmful habit," said Minister Mella. "She emphasized that this was not a revenue measure as much as a health measure."

The federal government is announcing an increase in the federal excise tax on cigarettes of $1.50 across Canada. In Ontario and Quebec, the federal increases are slightly higher in order to bring the federal tax to a uniform level across all provinces.

In Prince Edward Island, the increase means that the cost of a carton of 200 cigarettes will go up by $3.50, plus GST of 25 cents, to approximately $49 per carton. A package of cigarettes will retail for about $7 following the tax increase. Previously a package sold for about $6.50. The provincial tax on other tobacco products and tobacco sticks will be raised proportionately.

At midnight tonight, the provincial tax on cigarettes will be 8.95 cents per cigarette, or $17.90 per carton of 200. The tax on tobacco sticks will increase to 7.24 cents per stick and 6.44 cents per gram of loose or fine cut tobacco.

Media Contact: John Palmer
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