Latest news with #excisetax
National Post
21-05-2025
- Business
- National Post
Cannabis Council of Canada Welcomes the Findings of Deloitte Report and Calls for Change to the Excise Tax to Strengthen Canada's Legal Cannabis Industry
Article content OTTAWA, Ontario — The Cannabis Council of Canada echoes the urgent need for excise tax reform as outlined in Deloitte's 2025 study on the Impact of the Cannabis Excise Tax. Article content Article content The report confirms what Canada's cannabis producers have long expressed: the current excise tax model is unsustainable and must be restructured to reflect the economic realities of the industry. Article content 'Canada likes to position itself as a global leader in legal cannabis – but since legalization in 2018, the federal government has failed this industry and the tens of thousands of hardworking Canadians it supports,' said Paul McCarthy, President of the Cannabis Council of Canada. 'With a new government in office, it's time for a fresh approach. The cannabis industry deserves the same attention and support as any sector of our economy.' Article content Canada's cannabis industry is a major driver of economic growth – since legalization it has contributed over $43 billion to the national GDP, with approximately $7.4 billion contributed in 2024 alone. To keep that momentum going, key policy changes are needed to ensure the industry can grow, compete and innovate. Article content The current excise taxation framework is completely misaligned with today's market realities. When it was introduced in 2018, cannabis sold for approximately $10 per gram. Today, producers are receiving as little as $3 per gram – yet the excise tax remains the greater of 10% of the product's value or $1 per gram. This has created a crushing and unintended tax burden that now is three times higher than what was originally envisioned. Instead of thriving, licensed producers are being pushed to the brink – many are unable to meet their tax obligations and are being forced out of the market, taking good jobs with them. If not fixed, Canada risks losing the very businesses it once championed through legalization. Article content The Cannabis Council of Canada calls on the Government of Canada to eliminate the $1 per gram floor and instead apply a 10% ad valorem rate as proposed by the Standing Committee on Finance in 2024. Article content The industry's challenges extend well beyond taxation. Since legalization, the previous government largely turned a blind eye to the persistent illicit cannabis market, allowing criminal actors to thrive at the expense of licensed businesses. This undermines the foundation of legalization and the promise of a safe, regulated cannabis industry. Illicit cannabis is estimated to make up between 25% and 40% of total sales in Canada – an unacceptable reality that demands urgent federal action. For the cannabis industry to thrive, the Government of Canada must act to eradicate criminal forces from the industry. Article content Elements of a comprehensive strategy must include tackling illegal production, shuttering illegal storefronts and online sales, interdicting shipments of illegal product, and launching a public awareness and education campaign on the dangers of supporting the illicit market. Many consumers who purchase cannabis online do not realize they are purchasing illegal products, nor do they recognize how harmful these products can be. Not only do these transactions support other crimes, but they also pose a significant threat to public safety. Article content The Cannabis Council of Canada (C3) is the national voice of the legal cannabis industry, representing Licensed Producers and Processors. C3 advocates for sensible cannabis policies that prioritize public health and safety, support economic growth, and promote social responsibility. Article content Article content Article content Article content Contacts Article content For media inquiries, please contact: media@ Article content Article content
National Post
20-05-2025
- Business
- National Post
John Ivison: Punitive taxes are killing the legal cannabis industry
If you want to be a millionaire, start with a billion dollars and launch a cannabis production company in Canada. Article content Article content In the original version of his famous quote, British entrepreneur Richard Branson was highlighting the challenges and capital intensive nature of the airline industry. But a new report by consultancy firm Deloitte, due for release on Wednesday, paints a similar picture. Article content Article content The report looked at the impact of Canada's cannabis excise tax and concluded the industry's financial viability is in question because of high taxes. Article content Article content The Cannabis Act of 2018 was a cornerstone piece of legislation for the Trudeau government, which pledged to 'outflank' organized crime by undercutting the black market for pot. Article content But the new report suggests that illicit producers still control between one quarter and a half of the market, partly because a punitive excise tax regime raises costs for legal producers. Article content The Deloitte report, commissioned by the Cannabis Council of Canada, said that the excise tax paid to governments accounted for 31.5 per cent of gross production revenues last year, at a time when prices are falling. Article content It would, of course, be rare to find an industry that endorses the amount of tax it is paying. Article content However, the government's own expert panel, which conducted a legislative review of the Cannabis Act last year, noted the industry's 'urgent concerns' about viability and said they were 'well founded.' Article content Article content Deloitte looked at the financial results of 36 licensed cannabis producers between 2019 and 2024 — nine of which filed for insolvency during the period under review. Article content Article content The share of production revenues diverted to excise taxes doubled in that time, making it the largest single expense. Article content When the excise tax was set at $1 per gram or 10 per cent of the value of dried or fresh cannabis seeds (whichever was greater), prices were around $10 per gram. But the flood of new entrants to the market, and the stubborn illicit market, lowered the price to around $3-4 per gram, sending the effective tax rate over 30 per cent. Article content The industry has argued that the excise duty should be adjusted to a uniform 10 per cent of value and the flat rate of $1 per gram should be eliminated entirely.
Zawya
19-05-2025
- Health
- Zawya
Oman: Sweet tax — has it helped?
Muscat: Governments worldwide have been increasingly exploring fiscal measures, such as excise taxes, to address public health concerns related to the consumption of unhealthy foods and beverages high in sugar, salt, or fat. The rationale behind these taxes is that increasing the price of these products will discourage consumption, potentially leading to improved dietary habits and health outcomes. Oman has implemented such taxes as part of its public health strategy. Oman introduced excise taxes on specific goods, including certain unhealthy items, as part of its commitment to public health and diversifying government revenue. An initial phase of excise tax implementation began in June 2019, primarily targeting tobacco products, energy drinks and carbonated drinks. A subsequent expansion in July 2020 broadened the scope to include other sweetened drinks and specific food items deemed unhealthy, such as chips, certain types of chocolate and biscuits. The tax rates applied vary, with a common rate of 50 per cent on sweetened drinks and 100 per cent on products like tobacco and energy drinks. The primary intended effect of imposing excise taxes on junk food and soft drinks is to reduce their consumption. By increasing the retail price, these products become less affordable for consumers. 'Economic theory suggests that demand for goods typically decreases as prices rise, especially if consumers can substitute them with cheaper alternatives. In the context of unhealthy foods and drinks, the hope is that consumers will either reduce their overall intake of these items or switch to untaxed, healthier options like water, unsweetened beverages, fruits, or vegetables,' said an economic researcher. He said that beyond reducing consumption, these taxes are intended to generate revenue for the government. 'This revenue can potentially be earmarked for public health initiatives, such as health education campaigns promoting healthy eating and active lifestyles, or for subsidising healthier food options, further supporting the public health goals,' he said. Evidence from various countries that have implemented similar taxes on sugar-sweetened beverages and unhealthy foods generally indicates a reduction in the sales and consumption of the taxed products. The magnitude of this reduction can vary depending on factors such as the tax rate, how the tax is passed on to consumers, the availability of untaxed substitutes and the price sensitivity of the population. While the immediate impact on purchasing decisions is primarily financial, the tax policy itself can contribute to raising public awareness about healthy versus unhealthy choices. However, the impact is not always straightforward. Regarding the impact on health consciousness, while the tax primarily works through price mechanisms, it can contribute indirectly. The public discourse surrounding the introduction of such taxes often highlights the health reasons behind them, which can increase awareness. Moreover, if the tax revenue is used to fund health promotion programmes, this can directly contribute to educating the public and fostering greater health consciousness. 'Consumers might switch to untaxed, but still unhealthy, alternatives. The effect on overall calorie intake or nutritional quality of diets can therefore be complex and requires careful evaluation. I know many people who still take unhealthy taxed drinks just like before. Here I mean 100 per cent on products like tobacco and energy drinks,' Abdullah al Khaldi, a parent said. So far, there is no specific data on the long-term impact of Oman's excise tax on consumption patterns and health outcomes. However, based on international experience, it is reasonable to expect that the tax has led to some reduction in the consumption of the taxed items in Oman. But for some, such taxes have made a difference. 'I used to drink one energy drink daily but ever since the prices went up, I have tried to reduce. Now I just buy them whenever I come across them, maybe once a week only. So, I would say tax increase has impacted my intake, Therefore, these taxes serve as a tool within a broader public health strategy aimed at improving dietary habits and promoting health awareness in Oman,' said Sufian Jamal, a private sector employee. 2022 © All right reserved for Oman Establishment for Press, Publication and Advertising (OEPPA) Provided by SyndiGate Media Inc. (
