As the Canadian federal government releases its budget plan for the year, the marijuana industry is reacting to new taxes for upcoming products.

On Tuesday (March 19), the Liberal government tabled its 2019 budget; in it, a few cannabis reforms attracted the attention of the market.


Based on recommendations from the cannabis task force set up en route to legalization in 2018, the government is proposing a tetrahydrocannabinol-based (THC) tax rate for the incoming edible and topical products.

The new system will be implemented starting in May and, according to the government, will not affect the already designated revenue-sharing deals with “most provincial and territorial governments.”

The government made it clear that existing legal products such as dried flower, seeds and seedlings will see no changes to their current excise-duty framework.

As a way to “alleviate compliance issues that producers have encountered with respect to the tracking of the quantity of cannabis material contained in cannabis oils,” the government is proposing this system for the new products.

In the final document, the government indicated:

“Budget 2019 proposes that edible cannabis, cannabis extracts (including cannabis oils) and cannabis topicals be subject to excise duties imposed on cannabis licensees at a flat rate applied on the quantity of total tetrahydrocannabinol (THC), the primary psychoactive compound in cannabis, contained in a final product.”

As indicated by the Cannabis Act, marijuana edibles, extracts and other topical products are set to be legalized this year on or before October 17.

Terry Lake, the vice president of corporate and social responsibility with licensed producer Hexo (NYSEAMERICAN:HEXO,TSX:HEXO), tweeted his support for the tax on THC items, saying it “makes for good public health policy.”

However, the former BC minister of health signaled this would represent another cost for patients who need high-THC products.

Several advocates, including executives in marijuana companies and associations such as Canadians for Fair Access to Medical Marijuana (CFAMM), have called out the government for its initial taxing system on medical cannabis.

In a message to supporters, CFAMM said the association is “disappointed” in the government’s decision to include sales and excise taxes on medical cannabis as part of its new budget.

Emerald Health Therapeutics (TSXV:EMH,OTCQX:EMHTF) issued an update to shareholders announcing that this tax could improve its profit margins on some of its hemp products.

“We believe that the federal government’s recommendation to revise the cannabis excise tax will reduce taxes on the low-THC products Emerald intends to produce from its contracted hemp harvest for medical use,” Avtar Dhillon, president and executive chairman of the firm, said in a press release.

“We expect that this proposed revision to the excise tax calculation will enhance our opportunity to utilize our purchased hemp in an economically viable way as feedstock for new cannabinoid-containing ingestible products,” he added.

Don’t forget to follow us @INN_Cannabis for real-time news updates!

Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.

Both locations expand access to the state’s widest-ranging inventory of medical cannabis products for Central Florida patients

Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) (“Trulieve” or “the Company”), a leading and top-performing cannabis company based in the United States announced today the opening of two brand-new Central Florida dispensaries. The new Clearwater and Tampa locations mark the Company’s 81 st and 82 nd nationwide, respectively, widening patient access to Florida’s largest and broadest assortment of high-quality medical cannabis products.

Keep reading... Show less

Lobe Sciences Ltd. (CSE: LOBE) (OTC Pink: GTSIF) (“Lobe” or the “Company”) is pleased to announce the appointment of Bart Oates Esq., President of the NFL Alumni Association, to its Advisory Board.

Philip Young, CEO and Director of Lobe, stated, “We are honored to welcome Bart to our Advisory Board. His first-hand experience on and off the field are tremendously valuable as we continue our research involving mild traumatic brain injuries and PTSD. These issues are prevalent in contact sports and we believe that athletes will play a prominent role in the continued acceptance of psychedelic medicines as legitimate treatment. We look forward to working with Bart as we seek to forge long-term strategic relationships.”

Keep reading... Show less

HempFusion Wellness Inc. (TSX:CBD.U) (OTCQX:CBDHF) (FWB:8OO) (“HempFusion” or the “Company”), a leading health and wellness CBD company utilizing the power of whole-food hemp nutrition, is pleased to announce that it has submitted its dossier to the United Kingdom’s Regulatory Food Safety Agency (the “FSA”).

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20210303005322/en/

Keep reading... Show less