Excise Act, 2001 (S.C. 2002, c. 22)

Marginal note:No sale or distribution except in original package

33. 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

34. 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

• 35. (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) a tobacco product 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.

Marginal note:Absence of stamping — notice

36. 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

37. If a tobacco product manufactured in Canada is not stamped by a tobacco licensee, the tobacco licensee shall immediately enter the product into the licensee’s excise warehouse.

Marginal note:No warehousing of tobacco without markings

• 38. (1) No person shall enter into an excise warehouse a container of tobacco products 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) No person shall deliver a container of imported tobacco products 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:Exception for prescribed tobacco product

  (3) Subsections (1) and (2) do not apply to a tobacco product of a brand if the brand is not commonly sold in Canada and is prescribed.

• Marginal note:Exception for prescribed cigarettes

  (4) Subsection (1) does not apply to cigarettes 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, if

  • (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.

Marginal note:Non-compliant imports

39. 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

• 40. (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

• 41. (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 tobacco product manufactured in Canada by the licensee for re-working or destruction by the licensee in accordance with subsection (1).

Duty on Tobacco

Marginal note:Imposition

• 42. (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.

Marginal note:Additional duty on cigars

43. 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.

Marginal note:Application of Customs Act

44. The duties imposed under sections 42 and 43 on imported raw leaf tobacco and tobacco products shall be paid and collected under the Customs Act, and interest and penalties shall be imposed, calculated, paid and collected under that Act, as if the duties were a duty levied under section 20 of the Customs Tariff, and, for those purposes, the Customs Act applies with any modifications that the circumstances require.

Marginal note:Duty relieved

• 45. (1) The duties imposed under sections 42 and 43 are relieved on a tobacco product that is not stamped.

• Marginal note:Tobacco imported by an individual for personal use

  (2) Subsection (1) does not apply to the importation of tobacco products by an individual for their personal use to the extent that the quantity of the products imported exceeds the quantity permitted under Chapter 98 of the List of Tariff Provisions set out in the schedule to the Customs Tariff to be imported without the payment of duties (as defined in Note 4 to that Chapter).

Marginal note:Duty relieved — raw leaf tobacco

46. The duty imposed under section 42 is relieved on raw leaf tobacco that is imported by a tobacco licensee for manufacture by the licensee.

Marginal note:Duty relieved — stamped tobacco imported by individual

47. The duty imposed under section 42 is relieved on manufactured tobacco imported by an individual for their personal use if it was manufactured in Canada and is stamped.

Marginal note:Duty relieved — importation for destruction

48. The duty imposed under paragraph 42(1)(b) is relieved on stamped manufactured tobacco that was manufactured in Canada by a tobacco licensee and that is imported by the licensee for re-working or destruction in accordance with section 41.

Excise Warehouses

Marginal note:Restriction — entering tobacco

49. No person shall enter into an excise warehouse

• (a) a tobacco product that is stamped; or

• (b) any other tobacco product except in accordance with this Act.

Marginal note:Definitions

• 50. (1) The definitions in this subsection apply in this section.

  “Canadian manufactured tobacco”

  « tabac fabriqué canadien »

  “Canadian manufactured tobacco” means manufactured tobacco that is manufactured in Canada but does not include partially manufactured tobacco or foreign brand tobacco.

  “foreign brand tobacco”

  « tabac de marque étrangère »

  “foreign brand tobacco” means manufactured tobacco in respect of which the special duty imposed under section 56 is relieved because of section 58.

• Marginal note:Categories of Canadian manufactured tobacco

  (2) For the purposes of subsection (5), each of the following constitutes a category of Canadian manufactured tobacco:

  • (a) cigarettes;

  • (b) tobacco sticks; and

  • (c) manufactured tobacco other than cigarettes and tobacco sticks.

• Marginal note:Prohibition on removal

  (3) No person shall remove from an excise warehouse or a special excise warehouse a tobacco product manufactured in Canada.

• Marginal note:Exception for Canadian manufactured tobacco

  (4) Subject to the regulations, Canadian manufactured tobacco may be removed from the excise warehouse of the tobacco licensee who manufactured it only if it is

  • (a) for export by the licensee in accordance with subsection (5) and not for delivery to a foreign duty free shop or as foreign ships’ stores;

  • (b) for delivery to the special excise warehouse of a special excise warehouse licensee, if the special excise warehouse licensee is permitted under this Act to distribute the Canadian manufactured tobacco; or

  • (c) for delivery to an accredited representative for their personal or official use.

• Marginal note:Maximum quantity permitted to be exported from excise warehouse

  (5) A tobacco licensee shall not, at a particular time in a calendar year, remove a particular quantity of a category of Canadian manufactured tobacco from the licensee’s excise warehouse for export if the total quantity of that category removed in the year up to that time by the licensee from the warehouse for export, plus the particular quantity, exceeds 1.5% of the total quantity of that category manufactured by the licensee in the preceding calendar year.

• Marginal note:Quantities to be excluded for the purposes of subsection (5)

  (6) In subsection (5), the total quantity of a category of Canadian manufactured tobacco manufactured by a licensee in the preceding calendar year does not include any quantity of that category that was exported by the licensee for delivery to a foreign duty free shop or as foreign ships’ stores.

• Marginal note:Exception for cigars

  (7) Subject to the regulations, cigars manufactured in Canada may be removed from the excise warehouse of the tobacco licensee who manufactured them only if they are

  • (a) for export by the licensee in accordance with this Act;

  • (b) for delivery to the special excise warehouse of a special excise warehouse licensee, if the special excise warehouse licensee is permitted under this Act to distribute the cigars;

  • (c) for delivery to an accredited representative for their personal or official use;

  • (d) for delivery as ships’ stores in accordance with the Ships’ Stores Regulations;

  • (e) for delivery to another excise warehouse, if the excise warehouse licensee of the other excise warehouse certifies in the prescribed form to the tobacco licensee that the cigars are for delivery as ships’ stores in accordance with the Ships’ Stores Regulations; or

  • (f) for delivery to a duty free shop for sale or offer for sale in accordance with the Customs Act.

• Marginal note:Exception for partially manufactured tobacco or foreign brand tobacco

  (8) Subject to the regulations, partially manufactured tobacco or foreign brand tobacco may be removed from the excise warehouse of the tobacco licensee who manufactured it only if it is exported by the licensee and not for delivery to a foreign duty free shop or as foreign ships’ stores.

• Marginal note:Removal from warehouse — ships’ stores

  (9) Subject to the regulations, cigars manufactured in Canada may be removed from an excise warehouse referred to in paragraph (7)(e) for delivery as ships’ stores in accordance with the Ships’ Stores Regulations.

• Marginal note:Removal from warehouse for reworking or destruction

  (10) Subject to the regulations, tobacco products manufactured in Canada may be removed from the excise warehouse of the tobacco licensee who manufactured them if they are removed for reworking or destruction by the licensee in accordance with section 41.

• Marginal note:Removal from special excise warehouse — accredited representatives

  (11) Subject to the regulations, Canadian manufactured tobacco and cigars may be removed from a special excise warehouse for delivery to an accredited representative for their personal or official use if the special excise warehouse licensee is permitted under this Act to distribute the tobacco or cigars.