Canadian Tax Breaks For Alcohol Industry Spark Calls For Equality From Cannabis Businesses


Canadian cannabis companies have called on the government to allow them the same tax relief as they recently afforded to the alcohol industry.

Last week, the Canadian Government announced plans to provide a cap on the inflation adjustment at 2% for beer, spirit, and wine excise duties for an additional two years, alongside plans to halve the excise duty on the first 15,000 hectolitres of beer brewed in Canada for two years.

In a press release, the government said the move was aimed at helping small craft breweries who provide jobs across the country ‘spend less on duties, and more on what matters most: growing and innovating their small businesses.’

StratCann reports that the local cannabis industry, which provides a comparable number of jobs as the alcohol industry, is shocked that they’ve not been granted the same help.

Speaking to the publication, CEO of independent cannabis producer Crystal Cure, Jonathan Wilson, said the fact that the tax relief was aimed at supporting ‘small businesses in peril’, it was either ‘cold-hearted or oblivious’ not to include the cannabis industry.

“Small cannabis producers that have been suffering under the current industry ecosystem, they are the ones without the cash flow to absorb the exorbitant taxes and fees, and they can’t sell at a loss in perpetuity. These producers were supposed to be the cornerstones of the industry, and it seems everyone is fine with them being allowed to crumble.”

Earlier this month, Business of Cannabis reported that Canada’s House of Commons Standing Committee on Finance had recommended a change in how cannabis is taxed.

This major change would see the current rate of $1 per gram, or 10% of a producer’s selling price (whichever is higher), be limited to 10% ‘ad valorem’, a percentage of the wholesale selling price of the cannabis product.

According to Canadian cannabis operator Organigram Holdings, who came out strongly in support of the proposals, the current framework means that the tax level is often equivalent to 35% of revenue, ‘undermining competitiveness and growth’.


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