PM proposes federal excise tax on legal pot, sharing revenue with provinces
OTTAWA — Prime Minister Justin Trudeau is proposing to levy a federal excise tax on recreational marijuana once it becomes legal next July, with the provinces and territories receiving half the revenue.
Under a federal proposal put to premiers during a first ministers meeting Tuesday, each gram of pot would be subject to an excise tax of $1 on sales up to $10 and a 10 per cent tax on sales of more than $10.
However, premiers argued that provinces will foot the lion’s share of the cost of regulating and enforcing the new regime and should, therefore, get the lion’s share of the revenue.
Trudeau said the level of taxation on marijuana and revenue sharing are still matters under negotiation with the provinces. He acknowledged that there will be “significant new costs” associated with legalizing pot and said he’s open to provincial arguments that they’ll bear the brunt of them.