Cities do slow burn over le­gal pot cash

The Observer (Sarnia) - - FRONT PAGE - ME­GAN STACEY

There may be as much as a bil­lion dol­lars in tax rev­enue at stake as Canada read­ies for le­gal­ized mar­i­juana next sum­mer.

The cut for cities? So far, zero. Mu­nic­i­pal­i­ties may be left in the cold when it comes to shar­ing in the cash from le­gal­ized pot sales, with the fed­eral gov­ern­ment propos­ing a 10 per cent ex­cise tax — or $1 per gram, which­ever is higher — to be split evenly be­tween the prov­inces and the feds.

Lit­tle has been said about how many, if any, tax dol­lars will flow to cities bear­ing the bur­den of costs associated with polic­ing, li­cens­ing and en­force­ment of mar­i­juana sales af­ter July 1.

South­west­ern On­tario lead­ers are none too pleased.

“Mu­nic­i­pal­i­ties aren’t even in the equa­tion. It’s this pa­tron­iz­ing ap­proach that the prov­inces take,” Sar­nia Mayor Mike Bradley said Mon­day. “They pass out the gruel when they want to.”

He’s frus­trated mu­nic­i­pal­i­ties weren’t even men­tioned in the fed­eral gov­ern­ment’s plan for mar­i­juana tax­a­tion an­nounced Fri­day.

Many of the costs and zon­ing chal­lenges of le­gal­iza­tion will nat­u­rally fall to cities, such as Lon­don, where le­gal pot shops are planned as part of the ini­tial roll­out in July 2018.

“Whether that’s polic­ing costs, im­ple­men­ta­tion costs, so­cial costs — we will be the ones that feel the brunt of that pres­sure,” Lon­don Mayor Matt Brown said.

An ex­cise tax would be added to pot prices be­fore sales tax un­der the fed­eral plan.

That means an $8 gram of mar­i­juana would sell for $9 plus HST in On­tario. In to­tal, that gram would cost $10.17 with ex­cise and sales tax.

Lib­eral MP and for­mer Toronto po­lice chief Bill Blair, who’s been tasked with helm­ing the gov­ern­ment’s pot plans, said the to­tal rev­enue, in­clud­ing ex­cise duty and sales tax, could reach $1 bil­lion.

The As­so­ci­a­tion of Mu­nic­i­pal­i­ties of On­tario is ad­vo­cat­ing for cities and towns to get their fair share.

“We’re go­ing to see the brunt of the work in (le­gal­iza­tion). So we’re telling both lev­els of gov­ern­ment that we’re go­ing to be need­ing some re­sources to go with the re­spon­si­bil­ity we’re go­ing to be given,” Lynn Dollin, pres­i­dent of AMO, said Mon­day.

Lon­don North Cen­tre Lib­eral MP Peter Fragiskatos hit back against the crit­i­cism, say­ing the fed­eral gov­ern­ment is pay­ing at­ten­tion to the needs of mu­nic­i­pal­i­ties.

“We are ac­tively lis­ten­ing,” he said. “We are not ig­nor­ing the con­cerns of cities.”

It’s much too soon to be ring­ing alarm bells, Fragiskatos said, point­ing out that Fri­day’s an­nounce­ment kicked off a month-long con­sul­ta­tion pe­riod on the pro­posed tax plan.

Pro­vin­cial and fed­eral fi­nance min­is­ters are slated to meet in the na­tion’s cap­i­tal af­ter con­sul­ta­tion closes Dec. 7.

For South­west­ern On­tario may­ors such as Bradley, the frus­tra­tion lies in the un­known.

“We’re in a cloud of smoke right now try­ing to fig­ure out what’s go­ing to hap­pen,” he said.

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