Dankr.ca – Your Toronto Connection
Article by Sam Riches, Growth Op
Alberta has been celebrated as the country’s fastest-growing cannabis market as the nascent industry continues to climb out of the shadows and into the mainstream.
The Sunshine Province led the nation in sales in the first year of legalization and it continues to outpace every province in retail operations. Currently, there are more than 400 cannabis retail stores in Alberta, compared to less than 40 in Ontario.
Alberta has also attracted significant investment from some of the country’s largest licensed producers, including Aurora, which moved to Medicine Hat in 2018 with plans to build the world’s largest cannabis greenhouse.
Aurora, which laid off 500 workers in February, has since slowed construction at that site. The operation was once touted as having the potential to bring 600 jobs to Gas Town, but Medicine Hat Mayor Ted Clugston told the National Post earlier this month that 100 jobs is a more likely scenario.
And now, with the budget tabled by the province’s United Conservative Party government on Thursday, the bright light in Canada’s cannabis sector has dimmed.
Pot, it turns out, has been a money-losing proposition for the province.
Alberta is expecting to lose $26 million in the sector in the current fiscal year — and stay in the red for the next three years — as foundational investments in retail systems, administration and inventory continue to outpace revenue. In 2020-21, a loss of $36 million is expected.
Some relief is coming via a 20 per cent tax that will be applied to vaping products, including cannabis liquids. That tax is projected to raise $4 million in 2020-21, and rise to $8 million the following year. By 2022-23, the total cannabis tax revenue for the province is projected to be $84 million.
