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Public Consultations on Proposals Relating to Taxation of Cannabis Launchedin Canadian Government News and Updates
Last June 21st, 2018, the Cannabis Act received Royal Assent. The Cannabis Act aims to keep cannabis out of the hands of children and the profits away from criminals and organized crime.
As many of you know already, cannabis for non-medical purposes will become available for legal retail sale in Canada on October 17, 2018. In preparation for this, the Canadian Government has released a set of proposals under Excise Act, 2001 for public consultation. These technical draft regulatory and legislative proposals will provide for the additional excise duty rates for each province or territory that has signed a Coordinated Cannabis Taxation Agreement (CCTA) with the Government. These rates will take effect when cannabis will be available for legal retail sale.
In the agreement under the CCRA, revenues from excise duties of cannabis products will be shared on the following basis: 75% to provincial or territorial governments, and 25% to the federal government. Federal revenues will be capped at $100 million per year for the 24 months that follow legalization of non-medical cannabis. Excess federal revenues over the $100 million cap will be provided to provinces or territories that have concluded a CCTA with the federal government.
The public consultation will seek input on additional regulatory proposals that would provide:
- Exemptions for certain entities to allow the possession of cannabis products stamped for multiple jurisdictions, under certain conditions;
- The ability for third parties to possess cannabis excise stamps for specific purposes; and
- Exemptions from the proposed excise duty for certain cannabis-related products that are not intended for human consumption.
If you would like to submit your comments on these proposals, you will need to do so by October 17, 2018.
You can send your comments to [email protected] You can also send in your written correspondence to:
Tax Policy Branch
Department of Finance Canada
90 Elgin Street