Today, Canadians are learning the details of the federal government’s proposed tax framework for legal cannabis.
The complex tax structure includes a federal excise duty of 50 cents per gram of cannabis, or five percent of the producer’s sale price of the product, whichever is higher.
If provinces agree to the proposed framework, the federal government has stated that total federal and provincial/territorial taxes should not exceed $1 per gram, or 10 percent of the producer’s sale price of the product, with tax revenues shared equally between the two levels of government.
Cannabis products will also be taxable under GST/HST. These taxes will be paid directly at the point of sale.
Proposed excise duty cannabis products, as seen on the Department of Finance website. Department of Finance Canada
The proposed duty will be applied to medical cannabis and starter material intended for patients who grow at home, though products produced by these patients or their designated growers will not be subjected to the duty. (GST/HST are already applied to medical cannabis.)
Manufacturers would pay the excise duty, while GST/HST