How much per gram? Provinces, feds to start debating pot price

TAX REGIME

ANDY BLATCHFORD OTTAWA • Governments from across the country will meet next month to debate a key question about Canada’s eventual recreational-marijuana market — how much should users pay for their pot?

Federal Finance Minister Bill Morneau said Monday that cannabis taxation will be on the agenda when he meets with his provincial and territorial counterparts.

Morneau said the Trudeau government has begun designing a taxation regime — but he insisted the top concerns for Ottawa remain getting weed out of the hands of young Canadians and dealers on the street.

“Taxation will follow those principles, so we will be thinking about how we can ensure that the taxation doesn’t generate a black market,” Morneau said.

He’s been adamant that maximizing federal revenues will not be the priority when it comes to pot and he’s suggested the feds favour keeping prices competitive in order to wipe out illegal activity.

A recent C.D. Howe Institute report found 90 per cent of the black market would disappear if pot cost $9 per gram, projecting $675 million a year in federal and provincial revenues if governments only applied existing sales taxes. Last fall, the parliamentary budget officer projected 2018 sales tax revenue for Ottawa and the provinces combined to be as low as $356 million and as high as $959 million.

Provinces and territories have been busy since the Trudeau government tabled legislation last month to