Article by Bruce Campion-Smith, The Toronto Star
Legalized pot will cost Canadians about $10 a gram and Ottawa has agreed to give the provinces 75 per cent of the tax revenues to help cover costs of setting up the new regime.
The agreement on the 75-25 tax revenue split came Monday during a meeting between federal Finance Minister Bill Morneau and his provincial counterparts.
The ministers pegged the cost at about $10 a gram. 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.
“Our expectation is that, by keeping prices low, we will be able to get rid of the black market. However that will happen over time,” Morneau said.
Ontario Finance Minister Charles Sousa said the price could be even less than $10 a gram as governments try to squeeze out the illegal market. “It’s important for us to be responsive to the marketplace,” he said.
The federal government in October had proposed a 50-50 split, a formula that prompted much grumbling among the provinces.
But even with the richer cost-sharing agreement, provincial ministers were quick to warn that no level of government will be getting rich from Ottawa’s move to legalize cannabis, due to take effect July 1.