On February 27, the Minister of Finance introduced the 2018
federal budget (Budget 2018), which proposed to implement the
new excise duty framework for cannabis that was originally proposed
in November 2017, to be effective when non-medical cannabis sales
become legal in Canada. The excise duty will be imposed under the
Excise Act, 2001 (Canada) and will apply to all cannabis
products available for legal purchase (e.g., fresh/dried, oils and
seeds and seedlings for home cultivation), including, somewhat
controversially, medical cannabis products.
Cannabis cultivators and manufacturers will be required to
obtain a licence from the Canada Revenue Agency (CRA) and remit the
duty. Budget 2018 indicates that the CRA will begin accepting
applications for cannabis licences and will issue excise stamps in
advance of the legalization date. The excise duty will apply at the
higher of two rates:
