1993 Legislative Session: 2nd Session, 35th Parliament
FIRST READING


The following electronic version is for informational purposes only.
The printed version remains the official version.


HONOURABLE GLEN CLARK
MINISTER OF FINANCE AND
CORPORATE RELATIONS

BILL 46 -- 1993

TOBACCO TAX AMENDMENT ACT, 1993

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of the Province of British Columbia, enacts as follows:

1 Section 1 of the Tobacco Tax Act, R.S.B.C. 1979, c. 404, is amended

(a) in the definition of "minister" by adding "and Corporate Relations" after "Minister of Finance", and

(b) by adding the following definitions:

"postal agent" means the Canada Post Corporation established under the Canada Post Corporation Act (Canada) and its officers, employees and agents;

"residence" means a building or part of it, recreation vehicle, manufactured home, trailer, tent or vessel that is actually occupied and used by the owner, lessee or tenant solely as a

(a) private dwelling,

(b) private guest room in a hotel, motel, auto court, lodging house, boarding house or club, or

(c) private summer dwelling, or private dwelling or living place used during vacation periods, or private lodge,

together with the land appurtenant to it that is essential or appropriate for the convenient use, occupation and enjoyment of a private dwelling or private summer dwelling; .

2 Section 2.1 is amended

(a) in subsection (2) by adding "or (3.1)" after "subsection (3)",

(b) in subsection (3) by striking out "in the Province from outside Canada," and substituting "into the Province through a port of entry from a place outside of Canada,",

(c) by adding the following subsection:

(3.1) A consumer who is an individual shall immediately, at the time of receiving tobacco, other than tobacco in the form of cigars, into the Province by post from a place outside of Canada,

(a) provide the postal agent where the tobacco is received with all information that is required by the postal agent regarding the tobacco, and

(b) pay to Her Majesty in right of the Province the same amount of tax that would have been payable had the tobacco been purchased in the Province, by paying tax to the postal agent as an agent of Her Majesty in right of the Province. ,

(d) in subsection (4) by striking out "Subsection (3) does not apply" and substituting "Subsections (3) and (3.1) do not apply",

(e) in subsection (5) by adding "or (3.1)" after "subsection (3)" and by adding "or postal agent" after "customs officer", and

(f) in subsection (6) (a) and (b) by adding "or (3.1) (b)" after "subsection (3) (b)".

3 Section 10 (2) is amended by adding "and Corporate Relations" after "Minister of Finance".

4 Section 27 is amended

(a) in subsection (1.1) by striking out "(7) or 14" and substituting "(7), 14, 36 or 44", and

(b) by adding the following subsections:

(2.4) A person who unlawfully possesses or keeps tobacco, or possesses or keeps tobacco for an unlawful purpose, in contravention of this Act or the regulations, commits an offence and is liable

(a) on a first conviction, if the quantity of tobacco is 150 cartons of cigarettes or less, to

(i) forfeiture of the tobacco to the Crown, and

(ii) a fine equal to the tax that would have been due on the retail sale of the tobacco,

(b) on a first conviction, if the quantity of tobacco is greater than 150 cartons of cigarettes, to

(i) forfeiture of the tobacco to the Crown,

(ii) a fine equal to the tax that would have been due on the retail sale of the tobacco, and

(iii) a fine of not less than $2 500 and not more than $25 000 or to imprisonment for not more than 2 years or to both fine and imprisonment, or

(c) on a subsequent conviction for the same offence under this subsection, to

(i) forfeiture of the tobacco to the Crown,

(ii) a fine equal to the tax that would have been due on the retail sale of the tobacco, and

(iii) a fine of not less than $2 500 and not more than $25 000 or to imprisonment for not more than 2 years or to both fine and imprisonment.

(2.5) For the purpose of subsection (2.4), if one of 2 or more persons, with the knowledge and acquiescence of the rest, has tobacco in the person's possession, it is, in the absence of evidence to the contrary, considered to be in the possession of each and all of them.

5 Section 28 is amended by adding the following subsection:

(3) In a prosecution under section 27 (2.4) and for the purposes of sections 34 and 35, the possession or keeping of tobacco in excess of 5 cartons of cigarettes by a person other than a dealer is, in the absence of evidence to the contrary, prima facie evidence that the person unlawfully possesses or keeps tobacco for an unlawful purpose.

6 Section 30.1 is amended

(a) in subsection (1) by adding "and postal agents" after "customs officers",

(b) in subsection (2) (b) by adding "or postal agent" after "customs officer",

(c) in subsection (2) by adding the following paragraph:

(c) authorize the government of Canada to enter into an agreement with the Canada Post Corporation respecting the administration and enforcement of this Act by postal agents. , and

(d) in subsections (3) and (4) by adding "or postal agent" after "customs officers" wherever it occurs.

7 Section 31 (1) is amended by adding the following paragraph:

(k) prescribing a rate of interest or the manner in which a rate of interest is to be determined for the purpose of section 40 (7).

8 Section 32 is repealed and the following substituted:

Proceeds paid into consolidated revenue fund

32 The proceeds of tax imposed under this Act and the proceeds of any forfeiture under section 40 (5) (a) must be paid into the consolidated revenue fund.

9 The following sections are added:

Right to search for tobacco

34 Where there are reasonable and probable grounds that tobacco is unlawfully possessed or kept, or possessed or kept for an unlawful purpose, a peace officer may, without a warrant,

(a) stop and search for tobacco in a vehicle, vessel or aircraft, or

(b) enter and search for tobacco in any place or premises, except a residence.

Warrant to search for and seize
tobacco in a residence

35 A justice who is satisfied by information on oath that there are reasonable grounds to believe that tobacco is unlawfully possessed or kept at a residence, or possessed or kept at a residence for an unlawful purpose, may at any time issue a warrant authorizing a peace officer to enter and to search the residence for the tobacco and to seize and remove from the residence the tobacco and the packages in which it is found.

Requirement to give assistance and information

36 (1) Where a peace officer stops and searches a vehicle, vessel or aircraft under section 34 or enters and searches any place, premises or residence under section 34 or 35, the person in charge of the vehicle, vessel or aircraft or the owner or occupant of the place, premises or residence must

(a) give the peace officer all reasonable assistance in connection with the stoppage, entry or search, and

(b) provide all information relative to the stoppage, entry or search that the peace officer may reasonably require.

(2) A person commits an offence who

(a) refuses or fails to stop when required by a peace officer under section 34,

(b) obstructs or attempts to obstruct a peace officer who makes an entry or search under section 34 or 35, or

(c) refuses to admit immediately a peace officer demanding entry to any place or premises as permitted by section 34 or 35.

Seizure of tobacco unlawfully kept

37 (1) Where a peace officer, while conducting or attempting to conduct a search under section 34 or 35, finds tobacco that in the peace officer's opinion is unlawfully possessed or kept, or possessed or kept for an unlawful purpose, contrary to this Act or the regulations, the peace officer may immediately seize and remove

(a) the tobacco and the packages in which it is kept, and

(b) any record or other document or any other thing found in the search under section 34 or 35 which, in the peace officer's opinion, will provide evidence of an offence against this Act or the regulations.

(2) A peace officer who removes anything under subsection (1) (b) must give a receipt to the person from whom it was removed and must promptly return the record, document or thing on completion of an investigation or proceeding.

(3) The Crown, or a person acting under the authority of this Act or the regulations, is not liable for loss or damage arising from the deterioration or destruction of anything detained or seized under this Act during the period it is under a detention or seizure lawfully made under this Act or the regulations.

Order for detention of things seized

38 (1) As soon as practicable but no later than 10 days after a seizure under section 37, the peace officer who made the seizure must report the seizure to a justice in order that the thing seized may be dealt with in accordance with subsection (3).

(2) If the seizure referred to in subsection (1) is made under warrant, the report must be made to the justice who issued the warrant or, if this is not practicable, to a justice having jurisdiction.

(3) On receiving the report under subsection (1), the justice may

(a) order the thing returned to its owner or other person entitled to it unless satisfied that an order under paragraph (b) should be made, or

(b) order the thing detained if satisfied that

(i) the detention is required for purposes of an investigation or proceeding, or

(ii) the thing may be subject to forfeiture under section 40.

(4) Anything ordered detained under this section that may be subject to forfeiture under section 40 and that is not required for the purposes of an investigation or proceeding must be placed in the custody of the director or a person designated by the director.

Detention of evidence

39 (1) Anything ordered detained under section 38, other than a thing that may be subject to forfeiture under section 40, must not be detained for a period longer than 3 months from the date of its seizure unless, before the expiration of that period,

(a) proceedings have been commenced in respect of the thing,

(b) the owner of the thing agrees to its continued detention for a specified period of time, or

(c) a justice, on application and after being satisfied that its continued detention is justified, orders its continued detention for a specified period of time not exceeding 3 months.

(2) More than one order may be made under subsection (1) (c), but the total time of detention of a thing detained under the authority of that subsection must not exceed one year unless proceedings have been instituted in which the thing may be required.

(3) The director may make or cause to be made one or more copies of any record ordered detained under this section or section 38.

(4) Anything ordered detained under this section or under section 38, other than a thing that may be subject to forfeiture under section 40, must be returned to its owner or the person entitled to it without delay on completion of all proceedings in which it may be required.

Detention and forfeiture of tobacco

40 (1) Anything ordered detained under section 38 that may be subject to forfeiture under this section must not be detained for a period longer than one year from the date of its seizure unless before the expiration of that period proceedings have been commenced in respect of the thing.

(2) A person who has custody of tobacco under section 38 may return all or part of the tobacco, together with any packages in which it is kept that are also in custody, to the owner or other person entitled to it on receipt of

(a) an amount of money equal to the value of the returned tobacco and packages plus an amount of money equal to the tax that would have been paid on the retail sale of the tobacco at the time immediately before they were seized, or

(b) where the director authorizes, security satisfactory to the director.

(3) After giving the owner of the tobacco or other person entitled to the tobacco a reasonable opportunity to obtain it under subsection (2), the director may sell or cause to be sold, or dispose of, in any manner other than by sale, all or part of the tobacco held in custody under section 38.

(4) The director must hold in trust any money or security received under subsection (2) and any money obtained on a sale under subsection (3) in lieu of the tobacco and packages that were returned or sold.

(5) Tobacco that was seized under section 37 (1) (a), any packages in which it is kept that were also seized, and any money or security held in lieu under subsection (4)

(a) are forfeited to the Crown if a conviction is obtained for a contravention of section 27 (2.4) in relation to the tobacco, or

(b) must be returned to the owner of the tobacco or other person entitled to it

(i) if no investigation or proceeding is commenced or continued for an alleged contravention of section 27 (2.4) in relation to the tobacco,

(ii) if, in a proceeding for an alleged contravention of section 27 (2.4) in relation to the tobacco, no conviction is obtained, or

(iii) if an order is made by the court under section 41 (2) for the return of the tobacco.

(6) If the tobacco cannot be returned under subsection (5) (b) to the owner or other person entitled to it because it has been lost or destroyed, there must be paid to that person out of the consolidated revenue fund an amount of money equal to the value of the tobacco and packages at the time immediately before they were seized.

(7) If money is returned to the owner or other person in accordance with subsection (5) (b) or paid to the owner or other person in accordance with subsection (6), there must also be paid to that person out of the consolidated revenue fund interest as prescribed in respect of the time between the date of seizure and the date the money is returned.

Third parties claiming an interest in things seized

41 (1) If tobacco is seized as forfeited under this Act, any person, other than a person accused of an offence resulting in the seizure or in whose possession the thing was when seized, who claims an interest in the tobacco as an owner, lien holder or holder of any like interest may, within 30 days after the seizure, apply to the Supreme Court for an order under subsection (2).

(2) If, on the hearing of an application made under subsection (1), it appears to the satisfaction of the court that

(a) the applicant is innocent of any complicity in the offence resulting in the seizure or of any collusion with the offender in relation to the offence, and

(b) the applicant exercised all reasonable care in respect of any person permitted to obtain possession of the tobacco to satisfy the applicant that possession of the tobacco was not contrary to this Act or the regulations,

the applicant is entitled to an order declaring that the applicant's interest is not affected by the seizure and declaring the nature and extent of the applicant's interest at the time of the contravention, and the court may order that the tobacco be returned to the applicant.

Report of seizures

42 Where tobacco is seized by a peace officer, the peace officer must promptly report in writing to the director the particulars of the seizure as soon as practicable but no later than 10 days after the seizure.

Absence of mark or stamp to be notice

43 The absence of the prescribed mark or stamp required to be affixed to any package in which tobacco is sold, offered for sale, kept for sale or found in the possession of any person, is notice to all persons that tax imposed on the tobacco under this Act has not been accounted for.

Prohibitions

44 (1) No dealer shall sell tobacco that does not bear the prescribed mark or stamp to a consumer who is liable to pay tax under this Act unless the dealer has taken reasonable care to ensure that the package in which the tobacco is kept bears the prescribed mark or stamp.

(2) A consumer who is liable to pay tax under this Act shall not purchase tobacco unless the consumer has taken reasonable care to ensure that the package in which the tobacco is kept bears the prescribed mark or stamp.

(3) No person who is liable to pay tax under this Act shall possess or keep tobacco in excess of 5 cartons of cigarettes where the packages in which the tobacco is kept do not bear the prescribed mark or stamp.

(4) No person shall transport in British Columbia

(a) tobacco in quantities in excess of 50 cartons of cigarettes, or

(b) tobacco in bulk in excess of 10 kilograms,

unless that person is a dealer or a common carrier under contract to a dealer.

 
Explanatory Notes

SECTION 1:

(a) housekeeping, and

(b) adds 2 new definitions for the purposes of the collection of tax under section 2.1 (3.1) and the search and seizure provisions under sections 34 and 35 respectively.

SECTION 2:

(a) is consequential to the new section 2.1 (3.1) of the Act,

(b) clarifies the application of section 2.1 (3) of the Act,

(c) requires that a consumer pay, and empowers a postal agent to collect, tax on tobacco that is sent by post into the Province from a place outside of Canada, and

(d), (e) and (f) are consequential to the new section 2.1 (3.1) of the Act.

SECTION 3: Housekeeping.

SECTION 4:

(a) is consequential of the new sections 36 and 44 of the Act, and

(b) creates a new offence and penalty provision for the unlawful possession or keeping of tobacco in contravention of the Act or regulations.

SECTION 5: establishes a presumption that the possession or keeping of tobacco in quantities in excess of 5 cartons of cigarettes is possession or keeping of tobacco for an unlawful purpose.

SECTION 6:

(a) and (b) are consequential to the new section 2.1 (3.1) of the Act,

(c) authorizes Canada, on behalf of the Province, to enter into an agreement with Canada Post Corporation whereby postal agents may administer and enforce the collection of tax under section 2.1 (3.1) of the Act, and

(d) is consequential to the new section 2.1 (3.1) of the Act.

SECTION 7: allows the prescribing of a rate of interest on monies payable under section 40 (7) of the Act.

SECTION 8: amends an existing provision to also provide that proceeds of a forfeiture under section 40 (5) (a) of the Act are paid into the consolidated revenue fund.

SECTION 9: enacts sections 34 to 44 of the Act:


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