Canada - Ottawa wants 10 per cent pot tax

[S.J.B.]

Ottawa wants 10 per cent pot tax
Bruce Campion-Smith
thestar.com
October 3rd, 2017

OTTAWA—Ottawa wants to impose a 10 per cent tax on marijuana sales and split the revenues with the provinces but premiers want a bigger slice, arguing their jurisdictions are bearing most of the costs of implementing and policing the federal government’s plan to legalize pot.

Prime Minister Justin Trudeau used a meeting of provincial and territorial leaders Tuesday to table Ottawa’s proposal for a federal excise tax on marijuana, when it becomes legal next July 1.

Under the plan, each gram of marijuana would have a tax of $1 on sales up to $10 and a 10 per cent tax on sales worth more than $10. Tax revenues would be split 50-50 with the provinces.

But that revenue-sharing proposal rankled premiers who have voiced worries about Ottawa’s timeline to legalize pot, as well their own costs to set up the retail system to sell it and added policing costs to enforce laws such as impaired driving.

B.C. Premier John Horgan said the tax proposal “caught us a bit by surprise” and complained that provinces — facing costs in distributions, regulation and enforcement — may now have to share “whatever modest” revenue there might be.”

Read the full story here.

 

[S.J.B.]

Since the pre-tax retail price will surely drop below $10 per gram fairly quickly, this will effectively be a "$1 per gram" tax, not a "10%" tax. Basically, the lower the price of cannabis, the bigger the cut the government will take.

 

[BeachBum4u]

"Modest revenue there might be..."
Are you kidding me? If California is any gauge in the tax revenue department, then Canada and its provinces are in for a pleasant surprise! From everything I've heard the revenue California collects is literally mind blowing. Sorry I don't have any hard figures to quote here but I think most folks would be surprised.

 

[S.J.B.]

Marijuana stocks rally as Ottawa proposes legal weed tax of at least $1 per gram, plus GST
Financial Post
November 10th, 2017

Ottawa and the provinces and territories could have another $1 billion a year in tax revenues to split after pot becomes legal next year.

Liberal MP Bill Blair, former Toronto police chief and the government’s point man on legalizing marijuana, made public the federal tax proposal for legal pot Friday, kicking off a period of public consultations that ends Dec. 7.

That, Blair said, gives the government just enough time to solicit comments on the proposal so that federal, provincial and territorial finance ministers can discuss it when they meet in Ottawa Dec. 10-11.

Marijuana stocks on the Toronto Stock Exchange jumped on the news, with Aurora Cannabis Inc. leading the way with a 15 per cent surge. Canopy Growth Corp., the country’s largest weed company by market cap, rose 2.84 per cent around mid-day, while Cronos Group. Inc. and MedReleaf Corp. were up 6.6 per cent and 5.83 per cent, respectively.

The plan would add an excise tax of $1 per gram of marijuana or 10 per cent of the final retail price, whichever is higher, with the revenues to be divided equally between Ottawa and the provinces and territories.

Read the full story here.