Two-Thirds of Canadian Marijuana Dealers Falling Behind in Tax Payments, Report Finds – Medical Marijuana Program Connection

The decline of Canada’s legal marijuana trade has led to two-thirds of marijuana dealers falling behind in their tax payments, according to a federal report.

“The total amount of unpaid cannabis excise duties has continuously been rising since legalization,” said a report by the Competition Bureau released May 26.

As of September 2022, 66 percent of licensees required to remit excise duties had an outstanding debt with the Canada Revenue Agency, and unpaid taxes last year totalled $52.4 million, according to “Planting the Seeds for Competition”, as first reported by Blacklock’s Reporter. The report said the total unpaid cannabis excise duties is projected to nearly double to $97.5 million this year.

The Competition Bureau wrote that following legalization in 2018, Parliament began taxing marijuana at $1 per gram plus GST, but with the average price per gram for dried cannabis falling since then, excise duties now take up a more significant portion of producers’ revenues, up to 30 percent or more.

The report stated that until recently, cannabis producers licensed under the excise duty regime were required to remit excise duties to the CRA on a monthly basis. However, many producers found this challenging since not all buyers pay for products on a monthly basis. The report noted that the Ontario Cannabis Store, for example, has 60 days to pay cannabis producers for their products.

The Department of Finance in Budget 2023 proposed to allow all cannabis…