About Raw Leaf Tobacco

As noted in the 2016 Ontario Budget, the Tobacco Tax Act (TTA) was amended in December 2015 to further strengthen oversight of Raw Leaf Tobacco (RLT). To support these amendments to the TTA, a regulation to prescribe baling or packaging, labelling, transportation, record‑keeping and reporting requirements and exemptions for RLT registrants came into effect July 27, 2016. Learn more about the new requirements, as well as existing requirements that relate to the changes.

Ontario Regulation 271/16 is available on the Ontario's e‑Laws website.

On January 1, 2015, the Ministry of Finance began its oversight of raw leaf tobacco. Under the Raw Leaf Tobacco Program the ministry will be issuing registration certificates and carrying out inspections and investigations as required.

The Ministry of Finance oversight of raw leaf tobacco applies to all aspects of raw leaf tobacco activity in Ontario. This includes both raw leaf tobacco that was grown in Ontario and raw leaf tobacco that has been imported into Ontario.

What is raw leaf tobacco?

For the purposes of the Raw Leaf Tobacco Program, raw leaf tobacco includes all varieties of unmanufactured tobacco grown in or brought into Ontario, including flue‑cured, dark‑fire‑cured/dark‑air‑cured (also known as black) and burley tobacco. It does not include seedlings.

Why is the Ministry of Finance regulating raw leaf tobacco?

The Raw Leaf Tobacco Program helps to manage and monitor the movement of tobacco products and impede the flow of untaxed products.

Raw leaf tobacco oversight is not about imposing a new tax – it's about effective monitoring. Provincial tobacco tax only applies to tobacco once it is in a state where it may be consumed (e.g., cigarettes, cigars or fine cut tobacco). The tax does not apply to the growing, processing, or dealing of raw leaf tobacco.

How does the Raw Leaf Tobacco Program work?

Under the Tobacco Tax Act, Ontario's Raw Leaf Tobacco Program includes:

  • a registration and reporting system for those producing, processing, transporting, exporting, importing, buying and selling raw leaf tobacco
  • inspection and audit oversight activities
  • seizure authority, and
  • civil penalties and offence provisions for failure to comply with the requirements to register and report.

Do I need to register?

You will be required, unless an exemption applies, to hold one or more registration certificate issued by the Ministry of Finance if you:

  • produce (e.g., plant, grow, harvest, cure or bale) raw leaf tobacco
  • process (e.g., strip, stem, thresh, re‑dry, blend or package) raw leaf tobacco
  • sell or buy raw leaf tobacco
  • bring into or take out of Ontario (import/export) raw leaf tobacco
  • transport raw leaf tobacco in Ontario and are not already registered with the Ministry of Finance as an inter‑jurisdictional transporter.

Conducting any of these activities without holding the required registration certificate(s) may result in seizure of the raw leaf tobacco, the assessment of penalties, or the imposition of a fine.

The Tobacco Tax Act requires all entities involved in the raw leaf tobacco industry to hold a registration certificate issued by the Ministry of Finance, and to deal only with other entities that hold the appropriate registration certificate issued under the Tobacco Tax Act. The Ministry of Finance will maintain a listing of raw leaf tobacco registrants.

How do I register?

Call the Ministry of Finance at 1 866 ONT‑TAXS (1 866 668‑8297) extension 16160 to register. You will be mailed a registration package to complete. Once you complete and sign the package, return it to the Ministry of Finance, 33 King Street West, PO Box 625, Oshawa ON L1H 8H9.

What if I was registered with the Ontario Flue‑Cured Tobacco Growers' Marketing Board?

Prior to January 1, 2015, the Ontario Flue‑Cured Tobacco Growers' Marketing Board regulated the growing and buying of raw leaf tobacco through its annual regulations. As a part of the Board's regulating of raw leaf tobacco, the Board would issue licenses in respect of the growing and selling of raw leaf tobacco.

With the commencement of the Ministry of Finance's oversight of raw leaf tobacco, you will now need to apply for and obtain a registration certificate from the Ministry of Finance if you intend to grow or buy raw leaf tobacco in Ontario. If you were previously a registered grower with the Board, please apply to the Ministry of Finance for a registration certificate. No fees will be payable to the Ministry of Finance in respect of the issuance of a registration certificate.

How do I know if I produce raw leaf tobacco?

A person produces raw leaf tobacco if the person plants or grows tobacco plants or harvests, cures or bales the tobacco.

More about Raw Leaf Tobacco Program Information for Producers

How do I know if I process raw leaf tobacco?

A person processes raw leaf tobacco if the person strips, stems, threshes, re‑dries, blends or packages it in Ontario. However, processing raw leaf tobacco does not include the manufacture, fabrication or production of tobacco products.

Is there a personal use exemption?

The Tobacco Tax Act provides for exemptions that allow an individual to:

  • produce and process for his or her own personal use, and not for sale, up to 15 kilograms of raw leaf tobacco per calendar year
  • buy up to 3 kilograms of raw leaf tobacco for his or her own personal use
  • import up to 3 kilograms of raw leaf tobacco for his or her own personal use
  • export up to 3 kilograms of raw leaf tobacco for his or her own personal use
  • transport up to 5 kilograms of raw leaf tobacco for his or her own or another individual's personal use.

This means you do not require a registration certificate under the Tobacco Tax Act for the above activities provided they do not exceed the maximum weight allowed.

In addition, the personal use exemption allows the sale or delivery of up to 3 kilograms of raw leaf tobacco to an individual for their own personal use.

What is a tobacco product?

Tobacco product means tobacco that is in a form in which it is used or consumed by a consumer, and includes cigarettes, cigars, fine cut tobacco and snuff.

What is the current annual registered grower data in Ontario on flue‑cured and non flue‑cured raw leaf tobacco?

Reported as of June 30, 2016

2016 Flue-cured 2016 Non Flue-Cured
195 licensed growers 38 licensed growers
15,353 total acres approved to be grown 927 total acres approved to be grown
18,751,945 expected kilograms to be grown 1,179,828 expected kilograms to be grown
This information is subject to change as new registrant applications are received and processed.

 

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