The Financial Post reports in its Wednesday edition that this month Ottawa sent the first weed excise tax payments to the provinces without disclosing amounts. The Post's guest columnist Michael Armstrong suggests Ottawa was mum because the cheques were smaller than expected. British Columbia is the only province to disclose its excise tax revenues -- $1.3-million for October to December, 2018. It had expected $50-million total this fiscal year, but now will be lucky to get $3-million. Other provinces have not disclosed their receipts. Manitoba did not even mention cannabis revenues in last week's budget. Mr. Armstrong, however, does his own math and figures Ottawa received about $16-million in excise taxes last quarter. During that period, Statistics Canada says legal pot sales totalled $307-million. The federal goods and services tax would have generated $15-million from that. This suggests Ottawa earned about $31-million in GST and excise taxes on cannabis last quarter.
At the end of 2018, black market sales still accounted for 80 per cent of Canadian recreational cannabis purchases. Streamlining the tax regime, and lowering the cost of the legal product, will be an important part of driving that share down.
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