Canada Brings in $186 Million in Tax Revenue as Sales Continue to Increase

It’s no secret that cannabis sales in Canada have gotten off to a relatively slow start as the government has taken a rather conservative, cautious approach to licensing, as government officials’ public safety concerns have been given top priority. Regulatory hurdles have hindered efforts to open up brick and mortar stores, caused supply chain issues, and completely prohibited the sales of any extracts, concentrates, or infused products. Thankfully, more stores are opening up, the supply chain is improving, and Canadian consumers will finally be able to by hash, oils, edibles, beverages and other cannabis products by the end of the year, so overall sale numbers should continue to climb. And sales are already improving as the federal government collected $186 million in tax revenue when legalization started last October, through March of 2019.

Revenue collection is set to only get better as adult-use cannabis sales jumped up to $19.6 million in Ottawa alone in April, after averaging just under $9 million the previous 5 months as Marijuana Business Daily reported:

Adult-use cannabis sales in Canada’s largest consumer market more than doubled in April on the back of new store openings, representing “powerful evidence” of pent-up demand for regulated marijuana after months of stagnation, according to experts.

Receipts of recreational-use cannabis products in Ontario totaled 19.6 million Canadian dollars ($15.1 million) in the month, recent data from Statistics Canada shows, up from CA$7.6 in March and CA$7.5 million in February.

April’s receipts consider the first monthly sales at fewer than two-dozen physical stores in the province.

Global News covered the overall tax revenue numbers:

The provinces took the lion’s share of that money, with $132 million in combined sales tax and excise tax revenue; the federal treasury took in $55 million.

Governments face a dilemma taxing cannabis, says Brock University business professor Michael Armstrong.

“It’s a tradeoff — the more you increase taxes the more revenue you get, but that increases prices and makes you less competitive with the black market.”

While it is admirable for the Canadian government to place officials’ health and safety concerns over the desire to raise revenue, it is clear to those with a lot of experience with cannabis, that a too burdensome approach isn’t needed. The sky hasn’t fallen in Canada and it won’t fall, as the fear mongering nonsense spouted by Reefer Madness prohibitionists gets proven wrong time and time again. Slowly but surely, regulators, politicians, and policymakers are learning the truth about cannabis and they are easing regulations. You can give more freedom to adult consumers in cannabis, the freedom to choose a safer alternative to alcohol and tobacco, while creating more jobs and revenue. As has been seen in Ottawa, and other provinces, build the cannabis retail stores, and consumers will come. And the sky will still remain high above the Great White North.

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