Department of Finance Canada Consulting Canadians on Draft Regulatory and Legislative Proposals Relating to the Taxation of Cannabis
September 17, 2018 – Ottawa, Ontario – Department of Finance Canada
On June 21, 2018, the Cannabis Act received Royal Assent, an important step toward legalizing and strictly regulating cannabis in Canada. The Act aims to keep cannabis out of the hands of children, and the profits away from criminals and organized crime.
Cannabis for non-medical purposes will become available for legal retail sale in Canada on October 17, 2018. In anticipation of this milestone, the Government of Canada is taking additional steps to implement the coordinated cannabis taxation framework that was agreed upon in principle by federal, provincial and territorial Finance Ministers in December 2017, and formalized through the signing of Coordinated Cannabis Taxation Agreements (CCTAs) with most provincial and territorial governments to date.
The Government today released for consultation a set of technical draft regulatory and legislative proposals under the Excise Act, 2001 that would provide for the additional excise duty rates for each province or territory that has signed a CCTA with the Government of Canada. These rates would come into effect when cannabis for non-medical purposes becomes available for legal retail sale.
In keeping with the agreement reached by Finance Ministers, under the CCTAs, revenues from the excise duties on cannabis products will be shared on the following basis: 75 per cent to provincial and territorial governments, and 25 per cent to the federal government. Provinces and territories will work with municipalities according to shared responsibilities towards legalization. In addition, federal revenues from the excise duty on cannabis will be capped at $100 million per year for the 24 months that follow the legalization of non-medical cannabis. Excess federal revenues over the $100 million cap will be provided to provinces and territories that have concluded a CCTA with the federal government.
This consultation also seeks comments 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-based products that are not intended for human consumption.
Canadians are invited to provide comments on the draft regulatory and legislative proposals detailed below by October 17, 2018.
Please send your comments to email@example.com. Written correspondence related to these consultations can also be mailed to:
Tax Policy Branch
Department of Finance Canada
90 Elgin Street
Note that references to “Announcement Date” in the draft regulatory and legislative proposals, and the accompanying explanatory notes included with this release, refer to today’s date. Some of these proposals may be included in a bill to be tabled in Parliament following the consultation period.
- Regulatory and Legislative Proposals Relating to the Taxation of Cannabis and Explanatory Notes
- Backgrounder – Modifications to the Excise Duty Framework on Cannabis Products
- Backgrounder – Cannabis Excise Duty Rates in Provinces and Territories
- EDN55 – Calculation of Cannabis Duty and Additional Cannabis Duty on Cannabis Products
- Backgrounder: Federal-Provincial-Territorial Agreement on Cannabis Taxation
- Excise Duty Framework for Cannabis (Canada Revenue Agency)
Media may contact:
Department of Finance Canada