Mr. Speaker, for the period November 4, 2015 to June 10, 2016, the CRA is unable to provide a response to the question as the administrative reporting system utilized does not currently include a specific category for marijuana dispensaries.
With regard to goods and services tax/harmonized sales tax, GST/HST, administration and income tax administration, the current reporting requirements that define the primary business activities of a given corporation are based on the North American Industry Classification System (NAICS) Canada 2012 industry classification standard. These NAICS standards are jointly developed and maintained by Statistics Canada and its counterparts in the United States and Mexico, and do not yet include a unique category for marijuana dispensaries. Further information on the NAICS is available at www.statcan.gc.ca/eng/subjects/standard/naics/2012/index.
Nevertheless, GST/HST applies on all taxable supplies made by GST/HST registrants. A taxpayer is generally required to register if the value of their supplies or services exceeds $30,000 per year. From a GST/HST perspective, marijuana is considered a taxable supply and would be subject to tax if made by a GST/HST registrant. All dispensaries/shops that are registered for GST/HST are required to collect and remit the GST/HST on the supply of marijuana. Additionally, from an income tax perspective, income earned from a marijuana dispensary or shop is taxable, and should be reported as business income. According to the Income Tax Act and to the Excise Tax Act, all income, from either legal or illegal activities, is taxable and is to be reported. Taxpayers and GST/HST registrants suspected of deriving income from illegal activities are risk assessed and appropriate compliance actions are taken by the CRA, working closely with the Royal Canadian Mounted Police, provincial and local police, and other law enforcement agencies.