The Canadian Taxpayers Federation is expressing some concern about Friday’s announcement from the federal government that they will put in a $1 per gram excise tax on cannabis once it is legal in 2018.
The first issue is the perception of a tax on tax, with that excise being placed on top of the GST.
“It’s the same thing we see with gas and some other commodities, so they’re adding a tax and they’re going to put GST on top of that, so that is something we’re not thrilled about,” said CTF Federal Director Aaron Wudrick. “Aside from the tax on tax, the initial reaction is this could work. But we’re glad to see they didn’t put it in stone and they’re still waiting on some feedback.”
Wudrick says on the surface, the pre-tax price of $8 a gram seems reasonable.
“There has to be a competitive price. If the tax on here makes the price of legal pot uncompetitive, it’s not going to achieve getting the money out of the hands of the black market.”
Wudrick is also concerned about the 50/50 split, arguing the provinces have a strong argument for receiving a bigger piece of the pie.
“Most of the costs of enforcing and policing this is going to fall on the provinces, so maybe it’s appropriate that the provinces actually get a bigger chunk of the proceeds than the feds.”