The ruling Liberals are under fire over a decision that allows government-owned casinos in Windsor and Niagara Falls to build shelters for smokers.

That has bar and restaurant owners crying foul because The Smoke Free Ontario Act, passed last June, does not allow them to do the same.

Health Promotion Minister Jim Watson argues casinos are exempt from that part of the act as their main business is gambling, not serving food or alcohol, and he denied there was any double standard.

"We do allow offices and factories and other organizations that are not in the food or beverage business the right to construct these shelters," he said. "There is not a double standard."

But the bar and restaurant industry counters that casinos serve large amounts of food and beverages and thus are part of the hospitality industry, which was forced to close its smoking shelters when the new legislation was passed.

Opposition critics agree.

"I think [the government's] argument is, to put it politely, horsefeathers," said Tim Hudak, the Conservative finance critic. "This is the ultimate in hypocrisy. The government has created a windfall for government-owned casinos, but changes the rules for every other private business."

Many observers point to a drop in business at the two border casinos, thought to be in part because the new smoking rules are chasing away American customers, as the real reason for the decision.

"There is no doubt revenues are down at casinos, and I'm sure that many people in government circles are pointing to the smoking ban as a result," said Shelley Martel, NDP health critic, who added the optics are bad.

"The perception is that government is doing something to benefit itself at the expense of others who cannot do the same thing."