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Canada Introduces ‘Sin Tax’ on Medical Marijuana

Canada Tax Medical Marijuana
Photo Gracie Malley for Cannabis Now


Canada Introduces ‘Sin Tax’ on Medical Marijuana

In Canada’s new federal budget, the country set up a tax framework that would tax adult-use and medical cannabis at the same high level.

Medical marijuana patients in the Great White North are fuming after learning the Canadian government included medical marijuana taxes in its federal budget.

In the budget released on Monday, Feb. 26, the Canadian government confirmed that it would be applying a 10 percent excise tax to all cannabis — both for medical patients and adult users.

Leading the calls against the move is Canadians for Fair Access to Medical Marijuana (CFAMM), an Ontario-based non-profit focused on supporting medical cannabis patients. The non-profit has been campaigning against the idea of taxing the sick since the idea was first floated by the Minister of Finance last November.

“We have heard from tens of thousands of patients across the country,” said Jonathan Zaid, Executive Director of CFAMM in a statement. “This new tax adds insult to injury for a community of patients already struggling to afford their medicine.”

The main reason behind the new wave of criticism from patients is the fact all of the cannabis products sold under Canada’s proposed Cannabis Act for medical purposes will be subject to the taxes and conditions of the general legal-pot structure being constructed in Ottawa, the capital city of Canada. People growing their own medicine will only be taxed at the point of sale for their seeds or starter plants.

Zaid also mentioned the border-transcending fact that medical cannabis patients rarely have the cost of their medicine covered by insurance and it is also the only medicine to which a sales tax is applied.

“A recent Environics poll found that a majority of Canadians (62 percent) are opposed to taxing medical cannabis,” said Zaid. “And to date, over 16,000 Canadians and a group of 12 non-profits have advocated for the elimination of it. Despite this fierce opposition, the federal government decided to forge ahead, implementing the new tax in its federal budget.”

The government did decide to exempt “low-THC cannabidiol [CBD] oils, which are sometimes used with children facing certain medical conditions,” according to Civilized. But Zaid said this will only help the small minority of patients that use those products.

“It’s quite clear that Canadians understand that taxing medical cannabis is unfair and wrong,” said Zaid.

“Exempting a small minority of patients does not address the affordability issue and implies some patients are more legitimate than others,” said Zaid. “Looking into a reimbursement program implies patients can afford to pay for their medicine in the first instance. They can’t.”

Besides the taxes, the medical aspects of the government’s pot plan are pretty decent. CFAMM said they’re pleased to see it include Health Canada evaluating the drug review and approval process to ensure it keeps up with cannabis developments. However, they are urging the government to commit to meaningful timelines and research.

David Berg, the president and chief technology officer of the Canadian tech company Strainprint, called the issue contentious and backed the efforts of CFAMM and other organizations working to convince the government and Health Canada to go in another direction.

“A purchase of cannabis will be subject to local sales taxes province by province, and then a federal tax levy of about $1 per gram,” said Berg. “There is currently no differential between taxes for recreation or medical patients.”

The actual tax revenue patients, and everyone else, will produce has been a hot issue in its own right. In December, the government announced an agreement that would send 75 cents of every dollar collected from cannabis during the first two years to the provinces. At the time, the Canadian Broadcasting Company noted that was a big jump from the 50-50 split the federal government had proposed as recently as November.

Marshall Rutman, vice president of marketing at the medical cannabis company Resolve Digital Health, said that he thinks the Canadian government is concerned that “recreational users may try to obtain prescriptions in order to avoid paying taxes.”

“I feel that legitimate cannabis patients shouldn’t have to pay more for their prescribed medicine because of the fear that the system will be abused,” said Rutman. “We should be ensuring adequate checks and balances are in place at the point of prescription, then trusting physicians to discern whether a medical need exists. If there is a true medical need, prescription cannabis should be treated as any other physician prescribed medication from a taxation standpoint.”

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