Preparing for the Legalization of Marijuana
By: Diana Hamdan
As of October 17, 2018, Canada has become the second country after Uruguay to fully legalize marijuana for recreational, medical, and cultivation purposes nationwide. The Cannabis Act1, also known as Bill C-45, was a milestone for Justin Trudeau whose election campaign included cannabis legalization as a major platform. It enforces a stringent legal framework for regulating the production, sales, and distribution of cannabis across Canada. As such, the Act mainly aims to keep cannabis out of the hands of minors, the profits out of the hands of criminals, and maximizes public safety by permitting access to legal cannabis. It comes as no surprise that the legislation was met with mixed responses and has attracted attention from all over the world. While the Act outlines strict regulations dictating cannabis use and distribution, it introduces many challenges that still need to be addressed.
In general, the Cannabis Act permits adults who are 18 years or older—depending on what the province deems as the legal age—to possess and share up to 30 grams of dried legal cannabis with other adults, purchase cannabis products from territorial and provincial retailers, and cultivate up to 4 cannabis plants per residence for personal use. However, different provinces and territories have the freedom to impose their own cannabis regulations. For instance, cannabis cultivation for personal use is prohibited in Quebec and Manitoba. Additionally, laws regarding illegal smoking areas and retailers where cannabis can be purchased differ between provinces. Hence, it is the responsibility of citizens to check the laws of the province, territory, or indigenous community that they reside in or visit2.
The financial impact of cannabis legalization will see the development of new markets and revenue streams for the provincial and federal governments. Cannabis sales will generate an excise tax revenue of the higher of $1 per gram or 10 percent of a product price. While 75 percent of the excised tax revenue will be allocated to provincial and territorial governments, 25 percent goes to the federal government. The federal tax portion is capped at $100 million annually, and anything in excess will be given to provinces and territories3. The legalization of marijuana will also result in a concomitant increase in demand for the cannabis labour market. In addition, tourism may also benefit since Canada has now become the only country where the same rules regarding cannabis apply equally to residents and visitors.
The wide availability of legal cannabis by regulated retailers will increase the likelihood that people choose it over illegal cannabis. However, customer’s decisions are likely influenced by the price at which cannabis is sold on the black market compared to that sold by legal retailers. In 2017, the consumer price of cannabis in Canada was approximated at $7.15 per gram4, whereas the average price of legal cannabis is sells for $10.30 per gram5. The wider the price gap between the cost of black market and legal cannabis, the more likely that the black market will thrive and the less effective legalization will be. Cannabis legalization will also serve to deter criminal activity by imposing serious criminal penalties on those operating outside the law, which in turn reduces the burden of cannabis offences on the justice system.
Several issues facing the legalization will need to be addressed in the near future. Developments in technology will be necessary to deal with the practical aspects of cannabis use. Unlike breathalyzers used in alcohol testing, tools for assessing THC levels require diagnostic testing at a laboratory, making them unsuitable for use by traffic police officers. Additionally, with the introduction of cannabis as a legal product, quality control and safety concerns will be paramount. Licensing, effective product labelling, product and dosage standardization, and regulated commercial cultivation will all play key roles in ensuring consumer safety.
Finally, education about both the risks and the health effects of cannabis consumption will be essential for maintaining public health. Addiction and counselling services provided through government and community programs will help to address risks of chronic use. Public education campaigns can inform users of health risks while deterring use by youths. Funds dedicated to research will be necessary over the coming years to monitor the impact of legalization on health and well-being.
Cannabis legalization marks new and uncharted territory for Canada, and the success of the process will be directly tied to how effectively we address the underlying societal and public health concerns.
- Cannabis Legalization and Regulation. Department of Justice; (modified 2018 Oct. 17). Available from: https://www.justice.gc.ca/eng/cj-jp/cannabis/
- What you need to know about cannabis. Ottawa: Health Canada; (modified 2018 Sept. 6). Available from: www.canada.ca/en/services/health/campaigns/cannabis/canadians.html#a2\
- 2018 Canadian federal budget plan. Government of Canada; (modified 2018 Feb. 27). Available from: https://www.budget.gc.ca/2018/docs/plan/chap-04-en.html#Cannabis-Taxation-Regulation-and-Public-Protection-Legalizing-Cannabis-in-2018
- Cannabis consumer and producer prices. Statistic Canada; (modified 2018 Nov. 8). Available from: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=3610059801
- What Will a Gram of Legal Weed Cost in Canada? Montreal: VICE; (modified 2018 Jul. 30). Available from: https://free.vice.com/en_ca/article/43pn9m/what-will-a-gram-of-legal-weed-cost-in-canada