Feds agree to give provinces 75 per cent of pot tax revenues


Murphy
#1
A good deal for the feds. Once the law takes effect, they will get a 25% cut, with the costs being borne by the provinces.

Money for nothing and your chicks for free!
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Feds agree to give provinces 75 per cent of pot tax revenues
Andy Blatchford, The Canadian Press

OTTAWA -- The federal government has agreed to give the provinces and territories a 75 per cent share of the tax revenues from the sale of legalized marijuana, a portion of which will be meted out to cities and towns to help them defray the cost of making pot legal across Canada.

Finance Minister Bill Morneau announced the two-year agreement today after a day-long meeting with his provincial and territorial counterparts.

Morneau says Ottawa will retain the remaining 25 per cent share to a maximum of $100 million a year, with any balance over and above that limit going to the provinces and territories.

The larger share, he added, will allow the provinces to "fairly deal with their costs and so they can work with municipalities," which had been asking for at least a one-third portion of the revenue to help ease the burden of costs like law enforcement.

Morneau said that over the first two years, the federal government expects legalized pot to generate only about $400 million in tax revenues, adding that the ministers are scheduled to gather again a year from now to assess how the framework is working.

"Our expectation is that by keeping prices low, we will be able to get rid of the black market. However, that will happen over time," Morneau said during a closing news conference, his counterparts lined up behind him.

The rest here.

Feds agree to give provinces 75 per cent of pot tax revenues | CTV News
 
Tecumsehsbones
+1
#2
They do the important work of policy, supervision, and oversight.
 
Hoid
+1
#3
It's pretty sad when they take over and sell the shit for more than anyone sells it for on the black market.

there is supposed to be some sort of premium on it because its illegal and getting caught is a risk to the seller.


I personally don't care because I will never buy weed off of them anyway but I feel badly for sick people who will be forced to pay those stupid prices for a product that is can be grown for almost nothing.

These "labs" that are growing for the gummit must be world class con artists.
 
Murphy
+1
#4
Quote: Originally Posted by Tecumsehsbones View Post

They do the important work of policy, supervision, and oversight.

Indeed.

I am reminded of the situation in the US with the Mob and Al Capone, years ago. The feds tried getting him for murder, assault, prostitution, numbers, etc., but nothing stuck. In the end, they jailed him for tax evasion.

Canada was watching. Like the US, Ottawa and the provinces saw a cash cow in a formerly unregulated or under-regulated market. I'm talking about alcohol, lotteries and some other things. In effect, the government ran the Mob out of town and took over their action.

It ain't illegal if you're the one making the rules.

Quote: Originally Posted by Hoid View Post

It's pretty sad when they take over and sell the shit for more than anyone sells it for on the black market.

there is supposed to be some sort of premium on it because its illegal and getting caught is a risk to the seller.


I personally don't care because I will never buy weed off of them anyway but I feel badly for sick people who will be forced to pay those stupid prices for a product that is can be grown for almost nothing.

These "labs" that are growing for the gummit must be world class con artists.

Those labs, as you call them, are licenced companies who have to comply with a medical standard for cleanliness and quality. The regulations are laid out by Health Canada. The federal government grants the licences and must comply with a very lengthy set of medical requirements.

One of the local medical grow ops was shut down for a few months because they had a mold problem. All stock had to be destroyed and the facility disinfected.

Unlike what many people think, leaves aren't the only thing produced by these companies. Oils, pills, and ointments are also manufactured. They are all inspected. These facilities are treated the same as any other drug manufacturer.

Health Canada is there regularly. As I said in another post, Peace Naturals sells their marijuana for $7 to 12 per gram. I have no idea how that compares to street dealers, but for businesses like Canopy who produce it, the requirement is clear: cannabis must be as clean and uncontaminated as any other drug.

As I said on another thread, ask them how prices are determined.

https://peacenaturals.com
 
justfred99
#5
Would it be too much to ask why the Federal Government is entitled to any of the tax being collected? Have we heard any reason they want some of the money? What would Just-in do with the tax money, use it to buy votes in the Liberal Rich constituencies in Ontario and Quebec? Since the provinces are committed to the Federal Equalization Program, would not it make Liberal sense to use the same system to make sure that their agenda is met? Will the Lying Liberals make it a condition of getting a license to grow marijuana is that they promise to vote Liberal in the next election?
 
JLM
#6
Quote: Originally Posted by justfred99 View Post

Would it be too much to ask why the Federal Government is entitled to any of the tax being collected? Have we heard any reason they want some of the money? What would Just-in do with the tax money, use it to buy votes in the Liberal Rich constituencies in Ontario and Quebec? Since the provinces are committed to the Federal Equalization Program, would not it make Liberal sense to use the same system to make sure that their agenda is met? Will the Lying Liberals make it a condition of getting a license to grow marijuana is that they promise to vote Liberal in the next election?


Apparently from what they were saying on the radio this morning is there is a big cost involved with checking potential supplier and licensing them and also costs involved with establishing education programs. If so someone should be holding their toes to the fire!
 
Tecumsehsbones
+1
#7
Quote: Originally Posted by justfred99 View Post

Would it be too much to ask why the Federal Government is entitled to any of the tax being collected?

As entitled as it is to the income tax or the GST.
 
JLM
#8
Quote: Originally Posted by Murphy View Post

Indeed.

I am reminded of the situation in the US with the Mob and Al Capone, years ago. The feds tried getting him for murder, assault, prostitution, numbers, etc., but nothing stuck. In the end, they jailed him for tax evasion.


https://peacenaturals.com


Not surprising- the gov't tends to get a little miffed with people who shirk their taxes. As for murder there are replacements born every minute!
 
petros
+2
#9  Top Rated Post
There isn't very much money to be made from weed. Input costs are insane.
 
Murphy
+1
#10
Quote: Originally Posted by Tecumsehsbones View Post

As entitled as it is to the income tax or the GST.

It is entitled. It was the percentage that was being contested. Originally, the feds wanted half of the take. Now, they are getting 30%.

Considering that healthcare costs, claims and collection are the responsibility of the provinces, the feds are making out like bandits.
 
taxslave
+1
#11
Quote: Originally Posted by JLM View Post

Apparently from what they were saying on the radio this morning is there is a big cost involved with checking potential supplier and licensing them and also costs involved with establishing education programs. If so someone should be holding their toes to the fire!

All costs which are invented by the feds.

IF all the various levels of government think this is just a cash cow to be milked dry I fear they are sadly deluded. Many people will simply choose to grow their own or keep on with their existing supplier at a price that will most probably be far below government price.
 
JLM
#12
Quote: Originally Posted by taxslave View Post

All costs which are invented by the feds.

IF all the various levels of government think this is just a cash cow to be milked dry I fear they are sadly deluded. Many people will simply choose to grow their own or keep on with their existing supplier at a price that will most probably be far below government price.


Blood will likely flow before it's all over!
 
petros
#13
Quote: Originally Posted by Murphy View Post

It is entitled. It was the percentage that was being contested. Originally, the feds wanted half of the take. Now, they are getting 30%.

Considering that healthcare costs, claims and collection are the responsibility of the provinces, the feds are making out like bandits.

Is it GST or the $1 a gram excise tax being shared?

Quote: Originally Posted by taxslave View Post

All costs which are invented by the feds.

IF all the various levels of government think this is just a cash cow to be milked dry I fear they are sadly deluded. Many people will simply choose to grow their own or keep on with their existing supplier at a price that will most probably be far below government price.

When I do buy it's $35 a quarter. How can the Feds beat that?
 
Murphy
#14
I do not know how much it has cost to bring this legislation into law, but I know who keeps tabs on expenditures: The Office of the Auditor General. (Link at bottom) You can bet their report will be on the desk of every federal and provincial MP when it comes out.

I'd like to know what the costs to date have been for the feds. Also, what they estimate their costs will be after 1 Jul 18. I guess Ottawa figures with the provinces looking after sales, licensing of retail businesses, policing, and court/administrative costs, that 30% is good. It seems to me that it was like a labour/management negotiation. Both sides wanting as much as they can get.

That said, this is a quote from the above article,

"Sousa added that the $100-million cap on the federal share is an important piece of Monday's agreement because now, "if there is a surge in the marketplace, we can accommodate it more effectively as we grow and respond to that marketplace."

There will be a cap on how much the feds will make. I think that Alberta's finance minister is onto something when he questioned how much this is costing the feds. About today's deal, Joe Ceci said, "...it's fairer than it was." He was referring to the 50/50 split changing to 70/30, in favour of the provinces. You can bet there will be more tussling over what the provinces feel the feds are entitled to, in the way of taxes.

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From The Office of the Auditor General of Canada

The Office of the Auditor General of Canada (OAG) serves Parliament by providing it with objective, fact-based information and expert advice on government programs and activities, gathered through audits. Parliamentarians use OAG reports to oversee government activities and hold the federal government to account for its handling of public funds.

What We Do
 
pgs
#15
Quote: Originally Posted by JLM View Post

Apparently from what they were saying on the radio this morning is there is a big cost involved with checking potential supplier and licensing them and also costs involved with establishing education programs. If so someone should be holding their toes to the fire!

Sounds like the Canada Food Inspection Agency . All the pieces are already in place .
 
petros
#16
Health Canada.
 
taxslave
#17
Quote: Originally Posted by petros View Post

Is it GST or the $1 a gram excise tax being shared?



When I do buy it's $35 a quarter. How can the Feds beat that?

THey can't, and that is going to be the downfall of their get rich quick scheme.
 
petros
+1
#18
All it takes is 1 spider mite to f-ck up a multimillion $ operation.

Quote: Originally Posted by taxslave View Post

THey can't, and that is going to be the downfall of their get rich quick scheme.

Then I'll be sticking to the $35 bags.
 
Murphy
#19
Health Canada will be doing the recreational side as well. They are currently licencing and inspecting medical cannabis facilities. They will continue.

Ontario has two agencies that will deal with the sale of cannabis.
 
taxslave
#20
All profits, if any will be eaten up in administration leaving nothing for the multitudes of spending programs thy got planned.
 
petros
#21
I noticed my Aurora shares are up today.
 
Murphy
#22
The provincial finance ministers are ticked, and rightly so IMO, about the tax percentages.

Cannabis Sales a Big Flash Point as Finance Ministers Meet

CTV News | News Video - Top National News Headlines - News Videos

Alberta Finance Minister Joe Ceci talks about today's deal.

http://www.ctvnews.ca/video?playlistId=1.3715593
 
petros
+1
#23
It's a cash chicken maybe a cash goat but definitely not a cash cow.
 
Murphy
#24
There will be a lot of money generated. Any siphoning off of profits will be by provincial and federal agencies in order to run them. I will try to find how much Ontario will be spending to operate the recreational cannabis market.
 
petros
+1
#25
No there won't. The margins aren't very high.
 
Tecumsehsbones
#26
On the thesis that the Federal government is only entitled to taxes from activities it is involved in, the entire Federal budget should come from taxing imports, exports, and Federally chartered corporations.
 
petros
+1
#27
You mean like it was originally intended?
 
Murphy
#28
Quote: Originally Posted by petros View Post

No there won't. The margins aren't very high.

On that, we'll have to disagree, and wait until the numbers come out next year. In the meantime,

Marijuana economics: predicting Ontario's legal pot market
Data on the potential for recreational weed sales suggest retail value of some $2 billion in first year

http://www.cbc.ca/news/canada/toront...ales-1.4298311

Want a job selling legal marijuana? You face an awkward dilemma
By Patrick Cain

It would make for a seriously awkward job interview.

Ontario plans to have 150 publicly owned marijuana stores open across the province by 2020. They’ll be staffed by people with what provincial employees’ union chief Warren ‘Smokey’ Thomas calls “good union jobs.” (Hourly wages for Ontario liquor store workers top out at over $27 an hour.)

And, as chance would have it, part of the province’s work force with years of experience in selling marijuana is about to come on the job market, as a promised shutdown of semi-tolerated dispensaries takes place.

https://globalnews.ca/news/3736757/d...gal-marijuana/

"Thomas said the 40 stores will likely require about 200 new union members and that could eventually grow to 1,000 or more."

https://www.thestar.com/news/queensp...next-year.html

One could say that businesses will have to pay big bux to employees, and that will reduce profits. The feds are expecting $400 million in sales the first two years. But I suggest that trusting a CDN politician's estimate is foolhardy. Colorado, with a population of 5.5 million, topped 1 billion (US) in sales in 2016. That's about 1.3 billion in Canuckian dinars. Even with a different business and tax structure, our sales will be higher than the feds have estimated.

Further, I would say that Parliament has no idea of how much will be made. They will have to wait and see, just like the rest of us.

Colorado Topped $1 Billion in Legal Marijuana Sales in 2016 | Fortune
Last edited by Murphy; Dec 11th, 2017 at 08:31 PM..
 
petros
+1
#29
$1B in gross sales. What's the net? What is the State's cut? How much is bought then resold nationwide illegally?
 
petros
+1
#30
Are you okay fagro?