There is still no deal between the province and local governments around sharing legal cannabis tax revenues and according to B.C.’s Finance minister there are still details needing to be worked out.
Carole James says with many stores still to come online, and lots of up front costs, the big question needing clarity is how much marijuana tax revenue will there be.
“What we have said to UBCM is we want to make sure that we have, first, a really good description of what municipalities will be responsible for and what the province will be responsible for. That will give us a chance then to determine what a formula will look like and then we want to see revenue so that we know how much revenue we have to share. But I am feeling very optimistic. We have had great meetings and UBCM has done some very good work around a revenue sharing formula. I am confident we can get to an agreement.”
James says a clearer picture on marijuana taxation should emerge in a year or so, which will help inform negotiations over a revenue sharing formula with local governments.
“It is early going yet. We certainly have had discussions with the Union of BC Municipalities because municipalities have expressed interest in revenue sharing. Some First Nations have expressed interest in revenue sharing. Right now the costs are outweighing revenue. We have had the costs to set up liquor distribution but for cannabis. There is a lot of infrastructure that is still going into place like licencing officers to make sure that the stores and the retail get open.”
Could legal cannabis be a significant source of revenue one day?
“I think it is early going yet. I am a pretty cautious finance minister that is why I build in the contingencies and that is why I make sure I build in the forecast allowance. I would say I am cautious at this point but I think everyone would be pleased to see another source of revenue in British Columbia to be able to share with communities.”
Last year the federal government agreed to give the provinces and territories 75% of marijuana tax revenues.
The province is now negotiating a revenue sharing formula with local governments.
