Evidence of meeting #108 for Veterans Affairs in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cannabis.
A recording is available from Parliament.
February 20th, 2019 / 4:25 p.m.
Director, Freedman and Koski Inc.
No, they are not taxed at the 2.9% sales tax rate. That is specifically because this is not going through pharmacy and is considered a sale in the State of Colorado. Also, yes, the 2.9% is to other goods in Colorado.
4:25 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
Okay. The reason for my questioning is to point out to this committee and to Canadians in general that the regime put forth by the current government is taxing medical cannabis going to veterans and other communities like the ones you've talked about, such as children with Tourette's syndrome or uncontrollable seizures who are using it as medicine because it is a prescription that they've received.
4:25 p.m.
Liberal
The Chair Liberal Neil Ellis
The bells are ringing now. Will we continue the meeting and Mr. McColeman's six minutes or do you want to get out of here? Is there unanimous consent to stay?
4:25 p.m.
Some hon. members
Agreed.
4:25 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
Thank you, Chair.
The current rollout here in Canada is that recreational and medical cannabis are considered the same in terms of the tax regime. You have HST, GST and then excise on top of that tax, and then a third tax that is being collected. Ours is being collected. I'm not sure of the exact rate, but I think it's around 15% or 16% on medical cannabis. There is an initiative in this country to move it to the Colorado model or that of the other states. I know, having done the research, that the other states do not have the tax. This boils down to some of the most vulnerable people not having accessibility because of the tax laws of this country and because of this particular government that rolled it out.
In my comments to you—and I would invite the other witnesses to weigh in on this matter—I will say that there are two distinctions here: medicine and recreational use. Being experts in the field of cannabis, do you make those distinctions in your minds?
I think I know the answer from the doctor from McMaster through his comments, but more particularly to our two witnesses coming in by video conference, do you make those distinctions? Also, do you believe that medical cannabis going to veterans and other vulnerable communities who are getting it by prescription should be subject to excise tax and other taxes that push up the price of this product, while at the same time every other prescription drug in Canada is not taxed?
4:30 p.m.
As an Individual
I believe there are two separate streams, the recreational stream and the medical stream. I think the medical stream needs help to continue to move further down that road. Research is one effort that needs to take place. Obviously, the ability of pharmacies to dispense cannabis needs to happen, and insurance companies providing more robust coverage of cannabis needs to happen as well.
Ultimately the tax that is on cannabis, the government has basically lumped it in and made it sound like it's a recreational product. That cannot continue. It is unfair for Canadians.
4:30 p.m.
Director, Freedman and Koski Inc.
I would say that of course I do believe there should be access for especially the more sympathetic communities here that I think have been waiting a long time for research. They should have both financial accessibility as well as physician oversight.
The one thing I would caution against in terms of price differential is we didn't see in the Colorado model that a lot of people stayed within the medical system due to the tax differential. I believe they were not there for medicinal purposes but essentially for the tax break. Because of that, I think we had a price incentive, essentially a buyer's discount. The part of that I regret is that those who were likely to become more addicted to the substance often went and got medical cards in order to buy it at a lower price.
4:30 p.m.
Conservative
4:30 p.m.
Peter Boris Chair in Addictions Research, St. Joseph's Healthcare Hamilton, McMaster University, As an Individual
I do. I'd like to make a number of distinctions.
One that's important from the start is the distinction between an authorization versus a prescription. It's important to note that medical cannabis is not prescribed like a prescription drug. It doesn't have a DIN, a drug identification number. It's authorized by a physician, meaning that effectively, the patient is given permission to use it, but it's not actually prescribed.
I also want to make the distinction that the products that exist in the medical marketplace in some cases are very distinct. They're pills. They're oils. They have non-psychoactive ingredients. But in other cases, they are also high-THC flower products that look indistinguishable from the recreational marketplace. Making a bright line between the two is possible in some cases but not in others.
I think that the use of tax policy makes a lot of sense in terms of making some of these distinctions, but I think that the point raised around unintended consequences and incentivizing people to pursue medical authorization has to be taken seriously too. It may be there could be greater precision that certain, very clearly medical products that are only medical, for example, unambiguously, would be appropriate and others might not be. This is difficult with tax policy but a nuance would be needed because there could be unintended consequences.
4:30 p.m.
Liberal
The Chair Liberal Neil Ellis
Thank you.
We have to go to the House to vote so we'll have to adjourn the meeting.
I'd like to thank the witnesses for their patience today. The clerk will get back to you about re-booking you for questions.
The meeting is adjourned.