Federal tobacco taxes are subject to an annual inflation adjustment, which is implemented on April 1 of each year. The adjustment for 2024 brings the federal tax on a carton of cigarettes to $33.15 (or $0.17 per cigarette). The federal government also charges 5% GST on tobacco products
Each province also applies taxes to tobacco, and most also charge provincial sales tax. Because of provincial differences in tobacco taxation, the taxes on a package of cigarettes range by about $4.50 across the country. Most Canadians live in Quebec and Ontario, which have the lowest rates of taxation.
No Canadian jurisdiction imposes price controls on Canadian cigarettes, and manufacturers are allowed to set their wholesale prices at different amounts for different retailers. On the image below (and the downloadable data sheet), data is presented for the impact of taxation on a package of cigarettes which wholesales for $4.41 and for which the retail markup is set at 10% of the wholesale price and excise taxes.
