Pubdate: Sat, 11 Nov 2017
Source: Globe and Mail (Canada)
Copyright: 2017 The Globe and Mail Company
Author: Daniel Leblanc
Page: A14


Advocates say Ottawa's proposed excise levy will simply penalize the

The federal government has angered proponents of medical cannabis and
the opposition by announcing that its planned excise tax on
recreational products will also apply to marijuana that is used to
treat various illnesses.

A large number of groups had been calling on Ottawa to remove the
sales tax that is currently imposed on medical marijuana. Instead,
they were shocked to learn on Friday that sales taxes will continue to
apply on medical marijuana, but also that an excise tax of $1 a gram
will be added on the product.

"It's a double whammy. This is of great concern for Canadian
patients," said Philippe Lucas, executive director of the Canadian
Medical Cannabis Council.

Ottawa is arguing that it does not want to create a financial
incentive for users to buy medical marijuana for recreational
purposes, but advocates said the excise tax will simply penalize sick
Canadians - and push some of them toward opioid use.

"Today, patients are forced to make treatment choices based on
finances, including switching to less effective medications with
severe side effects, such as opioids. The proposed application of
excise tax to medical cannabis will further compound these issues and
will impose significant barriers for patient access," said Jonathan
Zaid, executive director of Canadians for Fair Access to Medical Marijuana.

B.C. lawyer Kirk Tousaw said the courts have defended the right of
sick Canadians to affordable access to medical marijuana.

"This is an adding a 10-per-cent burden to the existing cost, so it's
new taxation aimed only at sick people. That is contrary to everything
we know about how we should do medicine," he said.

The NDP said it will fight the proposal in Parliament, hoping to
convince MPs from all parties to reject the proposal.

"From almost every public-health angle, the decision by the Liberals
to apply the excise tax is inconsistent and contrary to public health
policy," NDP MP Don Davies said.

Conservative health critic Marilyn Gladu said that medical marijuana
should be exempt of any taxes.

"This is just another example of the government going after the
vulnerable for taxes. These are people who have chronic pain
conditions or PTSD in many cases," said the Conservative MP. "They
should have applied the zero tax that was recommended to them. They
say they consult, but they don't listen."

There are about 300,000 Canadians using marijuana for medical
purposes. The excise tax will add at least $300 a year to an average
medical-cannabis bill.

Prime Minister Justin Trudeau announced plans in October for an excise
tax on recreational marijuana of $1 a gram on purchases less than $10,
and 10 per cent on amounts more than $10. As the federal government
announced consultations on the proposed excise tax on Friday, it also
said it would apply on medical marijuana to ensure that it will be
priced in the same manner as recreational products.

"Our government remains committed to maintaining a functional
medical-marijuanasystem," said Liberal MP Bill Blair, who is the
parliamentary secretary to the ministers of health and justice. "At
the same time, we do not want the taxation levels to be an incentive
for people to utilize that system inappropriately, and so we propose
that the taxation levels for both medical and non-medical will be aligned."

Mr. Lucas said the federal government's rationale is

"It's a morally and ethically untenable position," he said. "We cannot
punish the 99 per cent of Canadians who are legally using medical
cannabis … in order to discourage the 1 per cent who might be inclined
to cheat the system."

Based on an estimated black market of 400,000 kilos a year, the excise
and sales taxes would bring in about $1-billion a year in revenue once
the drug is legalized by July, 2018.

In the lead-up to legalization, the federal department of finance will
consult other levels of government, as well as various stakeholders,
on its proposed excise tax framework. The findings will be shared at a
meeting of federal and provincial finance ministers on Dec. 10 and 11
in Ottawa.

According to the federal proposal, the excise tax would be split
evenly with provincial governments.

Alberta Finance Minister Joe Ceci slammed the federal proposal for the
50/50 split for the excise tax, saying the provinces and
municipalities will be responsible for the additional costs related to
policing, education and other ongoing implementation work on the
ground - not Ottawa. He said he doesn't object to the 10-per-cent tax,
but says 100 per cent of that amount - or close to - should go to the

He said other provinces are on the same page.

Municipalities are also calling for a share of the revenue, given
their role in enforcing bylaws.

"Your government has proposed a cannabis-revenue-sharing formula with
the provinces to support ongoing costs," Jenny Gerbasi, president of
the Federation of Canadian Municipalities, said in a letter to Mr.
Trudeau on Nov. 2. "Given municipalities' central role in
administration and enforcement, municipalities should be meaningful
participants in these revenue-sharing conversations. Regardless of the
formula adopted, ensuring public safety will depend on predictable,
long-term support for local administration and enforcement."

B.C.'s Finance Minister said her government wants a greater share of
marijuana tax revenue, arguing the province must shoulder costs
related to legalization such as education and policing.

"I'm taking the federal minister at his word that this is a
consultation and negotiation, so I'm looking forward to that
conversation," said Carole James. "To look at a 5050 split when we're
taking more of the share of responsibility here in B.C. just isn't
fair and certainly isn't going to work for our province."

- - With files from Kelly Cryderman and The Canadian Press
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