Article by CBC News
Cannabis industry players welcomed the change in the Federal Budget to tax edibles, extracts, oils and concentrates based on the amount of tetrahydrocannabinol rather than weight, as it could ease pricing for some products and potentially boost product availability.
However, licensed producers and a patient advocate group say they are disappointed that medical cannabis will continue to be taxed, despite a campaign calling on Ottawa to exempt patients.
Organigram’s chief executive officer Greg Engel said under the new framework, prices for some of these next-generation cannabis products, depending on potency of tetrahydrocannabinol, or THC, could see some relaxation.
“Ultimately for the consumer, they’re only going to be paying … for what is in the final product, not how it was produced,” he said.
The Liberal government on Tuesday laid out its 2019 budget which proposed that cannabis edibles, extracts, topicals and oils — which Ottawa has said will be legalized by no later than October of this year — be subject to excise duties based on the total quantity of THC, in the final product, rather than by weight of the cannabis used as an input.
Since Canada legalized cannabis for adult recreational use last October, dried cannabis flower and cannabis oils are subject to an excise tax of one dollar per gram or 10 per cent of the final retail price, whichever is higher. The tax rate is higher on flowering material, and lower on non-flowering material, such as stem.
But for the next generation of cannabis products, such as edibles, Ottawa has proposed an excise duty of one cent per milligram of total THC. Cannabidiol or CBD, the active ingredient found in cannabis and hemp that does not produce a high, is exempt from the excise tax.