Calgary Not Getting Enough Cannabis Excise Tax
City Claims It Has to Cover Cannabis-Related Costs Itself – LPC
Matt Zabloski, Calgary’s lead on cannabis legalization, said that it is not receiving its share of the cannabis excise tax. That’s making it more difficult to pay for the services needed to properly police and manage cannabis consumption within Calgary.
“It’s highly likely that cannabis is going to be a windfall for the provincial government,” Zabloski said. “If we could get that 25 per cent (of the cannabis excise tax) that was promised by the federal government… I think we’d be quite happy with that. So far, we haven’t seen that.”
Calgary Mayor Naheed Nenshi said essentially the same thing, but a bit more forcefully.
“We remain extremely frustrated. The federal government’s very clear direction was that their cost-sharing with the provinces on the cannabis excise tax was meant to reimburse municipalities for their costs. Frankly, we’re just not getting it,” he said earlier this year.
So far, the city has spent $6.9 million on cannabis-related costs since legalization. Most of that was for policing, but other training for bylaw officers, firefighters, and transit are included. Zabloski expects costs to go down year over year. However, there will always be costs associated with enforcement and other areas. He wants to see Calgary’s portion of the cannabis excise tax go towards that.
“We do expect those costs to come down given that the implementation of cannabis legalization has been relatively smooth,” Zablowski said. “Certainly it’s going to be significantly higher than the $3.84 million that was finalized by the province to give to the city.”
Is the Cannabis Excise Tax Unfair? – LPC
Many have argued from the start that the cannabis excise tax is unfair.The fact that the tax also applies to medical use cannabis is seen as particularly unfair. Medical use aside, there are real costs associated with creating a framework for the legal consumption of cannabis. As noted in the Calgary example above, added training and other associated costs are real costs. Generating revenue from cannabis use isn’t an unreasonable way to cover those costs.
However, if the Calgary example is any indication, there seems to be issues on how these taxes are being used. There is also evidence that the cannabis excise tax is not generating as much revenue as governments had hoped. Removing tax for medical users seems like a good idea – and it may become a reality with the Liberals’ recent minority government win. (The NDP lobbied on removing this tax.) Black market cananbis still thrives in part because of taxes on legal cannabis. But not enough to suggest that the cannabis excise tax would – or should – disappear anytime soon.
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