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Canada Wants to Tax Your Cannabis Based on THC Content

March 20, 2019
2019 Budget
The next wave of cannabis products in Canada will be taxed by THC-content according to the federal government’s 2019 Budget.

Coming into effect on May 1, edibles, extracts, and topicals will be subject to excise duties at a proposed rate of one cent per milligram of total THC.


Health Canada Proposes Regulations for Edibles, Extracts, and Topicals

Under the current tax system, dried cannabis flower and cannabis oils are subject to duty rates of $1 per gram, or 10% of the sale price of a product.

The government claims that the proposed THC-based rate will help simplify the excise duty calculation for specific cannabis products and ease compliance issues that producers have encountered with respect to cannabis oils.

Tax Credits for Medical Cannabis Patients

While the 2019 budget fails to repeal the excise tax on medical cannabis—making cannabis the only class of medical product that has an excise tax—medical cannabis patients may find some relief through tax credits.

The 2019 budget proposes amendments to the Income Tax Act to reflect the current regulations for accessing cannabis for medical purposes. Qualifying medical expenses, including amounts paid for cannabis products, may be eligible for a 15% tax credit that “recognizes the effect of above-average medical or disability-related expenses on an individual’s ability to pay tax.”


A Guide to Canada’s Medical Marijuana Program

“Eligible expenses for the medical expense tax credit will also include expenses for other classes of cannabis products purchased for a patient for medical purposes, once they become permitted for legal sale under the Cannabis Act.”

The budget also promises that certain low-THC products (e.g., cannabis oils) will also generally be subject to lower excise duties than before, providing further tax relief for cannabis products typically used by individuals for medical purposes.

In response to the 2019 Budget, the Canadians for Fair Access to Medical Marijuana (CFAMM) tweeted that they were “disappointed ” by the decision to retain both sales and excise taxes on medical cannabis as a whole.

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William Norman

William Norman is a Government Relations Associate for Leafly Canada

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  • Chili Bu Tube

    many of us spoke LOUD and clear as to what the gov’s idea of legal-LIES-ation would be as the corporate farce that it is has reared it’s ugly head globally,
    many of this very congregation poo poo’ed that train of thought and spoke of sunny days where cannabis is freely available to one and all with no more charges, etc, etc….
    we know how this country on Oct 16th/2018 had 8 offences for cannabis use, cultivation and sale, the next day Bill C-45 came into effect and the number of offences jumped to 45 with harsher, more strict personalities then ever before in history (not too mention the new drugged driving laws which is another ugly kettle of corporate fish)
    well once the cat is out of the bag you sure as hell are not getting it back in so kudo’s for the herd for going balls to the wall for the pathetic carrot dangled by the gov, literally handed a decades long culture up here in d’oh Canada to the gov and their corporate interests…
    (matter of factly one must keep in mind that no matter who was running the corporation of Canada…legalization would have been the same when it came to fruition, back room deals, ex political types and cops HEAVILY invested)
    might I add this small caveat that is what you grow veggie wise in your garden would not pass the ridiculous guidelines that Health Canada imposes on both med/rec cannabis and cannabinoid products….
    …they allow LP’s to spry any of 21 different chems/pesticides on flowering and dried cannabis!!!!
    who the fuck does that??
    I digress tho as ‘I told you so’ does not suffice but supporting your local craft cannabis farmer, the extraction artists and those not looking to bank it during the greed/green rush,
    #justsayno to #kmartkannabis and #keepyourguyonspeeddial
    #boycottlps and keeping fighting for true cannabis freedoms for one and all ✊

  • Barry Marshall

    Just screwing themselves. The black market will flourish if they keep making dumb laws.

  • Ross Frisken

    Just how the F**k can they charge extra tax for higher THC…. whose brain actually works like this?? Is a bottle of whiskey that is 40% alcohol less expensive than a bottle that has 45%…or 50%???….a can of beer that is 5%….or 8%??….just who in this country is that mentally deficient to think this is a valid formula. I welcomed legalization as I hoped for a place that this plant could be used as it was intended and that common sense would prevail with legislation but I am beginning to see a different kind of picture being painted by the same disjointed minds that kept it illegal. We have a LOT of work to do on this legislation before it can be considered TRUE legalization….not semi prohibition…. 🙁

  • jeff

    Does not make sense THC and alcohol are 2 different things, If you have 1 gram of high THC, your still going to smoke like 3 joints out of it just like low and mid range THC Joints and it will wear off in the same amount of time.
    Unlike say 341ml of beer or scotch where I could make 8 times the amount by buying scotch and hence the higher tax. You don’t get any extra with Higher THC cannabis.

  • Ronald Akridge

    Thing is not all people can afford it. Stop making laws like this. Instead, help medical marijuana patients to get their daily dose of marijuana at a much lower price.