Canada to Legalise and Tax Marijuana

June 21, 2018 Taxation in Canada

marijuana legalisationOTTAWA – Canada could see as much as CAD 400 million per year in extra tax revenues, following its move to legalize cannabis.

The Canadian government has become the first G7 nation legalize recreational marijuana, and alongside the newly opened up rules come the potential for significant tax revenues for the government.

The sale of marijuana in Canada will be taxed at the higher amount of either the rate of CAD 1 per gram or 10 percent of the retail price.

The revenues gathered from the tax will be split between the federal government and the provincial governments.

The federal government will take the lower of either 25 percent of all tax revenues collected, or CAD 100 million each year.

It is expected that the total amount of sales in the new legal marijuana industry could rise to as much as CAD 6.5 billion by 2020.

The accompanying tax revenues are expected to reach approximately CAD 400 million in the first year.