Products containing CBD, the non-psychoactive component in cannabis, are exempt from excise tax
Cannabis oils, edibles and concentrates will be taxed based on the quantity of tetrahydrocannabinol (THC), the psychoactive component in cannabis, rather than by weight, starting in May.
The Liberal government says the new rules are meant to simplify how these taxes are calculated, and ease compliance issues that producers have encountered with respect to cannabis oils. The taxes apply to both medicinal and recreational cannabis products.
Dried cannabis flower and cannabis oils, which were legalized for recreational use last October are currently subject to a 10 per cent excise tax on each gram or gram-equivalent, or $1 per gram — whichever is higher — regardless of THC content.
But the Liberal government’s 2019 budget is proposing that edible cannabis, cannabis extracts and cannabis topicals, all of which are new lines of cannabis products that are set to become legal this fall, will be taxed based on how much THC they contain.
The government is proposing a THC-based excise duty rate of 1 cent per milligram of total THC.
Vanmala Subramaniam – Financial Post – March 19, 2019.