Seeing past the smoke

Canada ranks among the healthiest countries in the world. Yet there are more than four million men and women in Canada who smoke cigarettes — and that’s despite vivid warnings and universal awareness of the serious health risks.

In March, the government announced a goal to reduce the number of people who smoke to five per cent of the population by 2035. Respectfully, we believe the goal could be much more ambitious than “5 by ‘35.” Faster progress is entirely realistic, especially given the country’s commitment to innovative approaches to public policy.

By our estimates, Canada can achieve one of the lowest smoking rates in the world well before 2035 through the right mix of measures that address the basic elements of supply and demand. Tobacco control largely focuses on impacting the demand side — for example, education, minimum-age laws, advertising bans and taxation. There’s no doubt that the best way to avoid the risks of smoking is never to start or to quit. That’s why demandside measures should absolutely be part of the mix. But they are not sufficient as, in any given year, thousands of Canadians start smoking and millions continue to do so.

That’s why rapidly developing technology, science and product innovation offer huge opportunities on the supply side — and that’s where we at Philip Morris International are focusing our attention and investments. In fact, our paramount business strategy is to replace cigarettes with less harmful alternatives as quickly as possible.

Cigarettes have had the same basic design since the 19th century. The smoker lights the cigarette and inhales the smoke. The key word is “smoke.”

When the tobacco in a cigarette burns, it releases nicotine along with many hazardous chemicals. The uncontrolled, high-temperature combustion process (not the nicotine) accounts for the serious diseases associated with smoking. Regulatory measures need to tackle the real issue — the smoke — rather than assume that all forms of tobacco use are equally harmful; and that’s exactly what we’ve done at Philip Morris International.

In over 25 countries, including Canada, we have launched a revolutionary product that heats — and does not burn — tobacco at precisely controlled temperatures. Instead of smoke, the product, IQOS, yields a nicotine-containing aerosol that contains dramatically lower levels of the hazardous chemicals than smokers inhale from a cigarette. oversight of manufacturing, sales, marketing, post-market surveillance and other steps in the supply chain; and (3) rules that respect the right of consumers to have information about new products while strictly prohibiting false or misleading statements.

Those three elements are logical and straightforward. They reflect Canada’s standards for sound regulation and draw on what other countries have been doing, including the United States, where the Food and Drug Administration oversees modified-risk tobacco products and encourages innovation that benefits smokers and the population as a whole.

Unfortunately, common sense and consumers’ interests seem to be losing out to that illustrate the flawed premises at work in S-5. Oil contributes to air pollution and CO2 emissions when it combusts, not when it’s used as a lubricant. Coal is most controversial when it burns as a fuel, not when it is a raw material for furniture and other products. And tobacco that heats rather than burns is not a cigarette.

Bill S-5 lumps all tobacco products into the same category as cigarettes, no matter how much scientific evidence might support a distinction among them. S-5 suppresses truthful information that would enable consumers to make better choices. As currently drafted, S-5 says to millions of Canadians, “This law will decide what’s best for you, and it has decided you don’t need or want to hear about alternatives to continued smoking if they contain any tobacco.”

As CEO of PMI, I am keenly aware that there is much from the past that continues to influence current perceptions of our company. I realize that it will only be possible to rebuild a measure of public trust through our actions, which the public should certainly scrutinize. There is no doubt in my mind that everything we say and do will be subject to intense examination.

S-5, however, presents an unusual anomaly. Unlike the many laws in Canada that protect consumers by requiring companies to disclose information, S-5 mandates that we suppress it. To be sure, there is a commercial aspect that concerns us, but there’s also a much more important interest at stake: the millions of Canadians who should hear about better products.

Rather than keeping people in the dark for their own good, the law should enable informed choice based on thorough scientific evaluation. We urge Parliament to consider revising S-5 to propel innovations that will lead to drastically lower smoking rates in Canada — well before 2035. that goal.

Eliminating the incomesplitting tax credit effectively meant an average $949 tax increase on middle-class families — defined as families with incomes between $77,089 and $107,624. That same middle-class group only benefited $228 (on average) from the government’s cut to the second-lowest income tax rate. Simply put, eliminating just the incomesplitting tax credit more than offset the benefit of the tax rate reduction.

When you add in the effect of eliminating the other tax credits, more than eight in 10 (81 per cent) of middleclass Canadian families will pay, on average, $840 more in personal income taxes this year because of the federal government’s tax changes.

First on the campaign trail, and then repeatedly in office, the Trudeau government has vowed to cut income taxes for Canada’s middle class — a goal. The reality, though, is that its income tax changes, taken together, have had the opposite effect and actually increased the amount of income taxes the vast majority of middle-class families pay.