Health Canada Announces Cost Recovery for Consumption

Health Canada Announces Consumption Cost Recovery Approach for Upcoming Cannabis Regulation

The Cannabis Act will come into force on October 17 2018. The Act aims to keep cannabis out of the reach of young people and the profits of organized crime. To do this, Health Canada plans to fully recover the costs of regulation. This will guarantee cannabis at a lower cost for Canadian consumers.

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Health Canada ready to take on the cost of cannabis

Le Government of Canada is committed to fully recovering the costs of regulating the cannabis industry. Cost recovery will ensure a purchase reduction for Canadian consumers. The ministerial order authorizing cost recovery for the regulation of cannabis will come into effect on October 17, 2018. This in conjunction with the Cannabis Act.

Health Canada responds to a public consultation of 30 days, held this summer, soliciting opinions from the public. The ministry has received hundreds of e-mails online; and over 755 form letters in response to their approach to regulatory cost recovery. In addition, Health Canada held four information sessions with the leaders of the Canadian industry. Especially with companies licensed as producers. Comments received by Health Canada focused on the timing of the implementation of the annual regulatory fee and the desire for additional service standards.

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As a result, Health Canada changed the design of the annual regulatory fee. This is to use the revenue from the previous year to calculate costs rather than forecast revenue. These measures will help mitigate the financial impact on the emerging industry in the first years after the Act comes into force.

“Cost recovery is standard practice across the Government of Canada to support program delivery. It ensures that those who benefit from the new legal market will pay the costs of regulating cannabis. Which will reduce costs for Canadians. We believe this approach addresses concerns raised by the cannabis industry, while ensuring that Canadians do not bear the costs of regulating cannabis. »Ginette Petitpas Taylor, Minister of Health

Administration of the regulatory program

In addition, Health Canada is committed to closely monitoring its regulatory program. This is to ensure that it does not recover more than the regulatory costs. The organization aims to achieve defined, service standards in areas such as processing license changes. The Department is also committed to creating a forum to collaborate with the cannabis industry and the administration of the law regime. Ultimately, this will lead to the development of additional service standards to promote predictability and transparency.

“We aim to minimize the costs of regulating the cannabis industry to Canadians without undermining our goal of preventing criminals and organized crime from making a profit. These fees are reasonable and balanced. Bill Blair, Minister of Border Security and Organized Crime Reduction.

Health Canada will adjust the fees according to the size of the business and apply lower fees for holders of small licenses. However, certain categories of permits, notably those for research, analytical testing and hemp production, will be exempt from duty. Those who produce, cultivate and sell cannabis exclusively for medical purposes will be exempt from the annual regulatory tax. The Ministerial Order will be published in Part II of the Canada Gazette on October 17, 2018.

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