Saskatoon

Saskatchewan Budget 2019: Province expecting marijuana tax revenues to bring in $5M

The Government of Saskatchewan is banking on pot sales to make a small contribution to this year's bottom line.

Regina mayor wants a piece of that revenue pie to go to municipalities

The 2019-20 Saskatchewan budget estimates the province will make $5 million in taxes from marijuana sales. (Peter Morgan/The Associated Press)

The Government of Saskatchewan is banking on pot sales to make a small contribution to this year's bottom line.

The 2019-20 budget estimates the province will make $5 million this year, the first full year of legalization.

The province expects PST on pot sales will bring in $2 million while federal excise tax is expected to account for $3 million.

For the province to generate $2 million in PST, total pot sales would need to equal $33.3 million. in the first three months of legalization, Saskatchewan trailed the rest of the country in sales, bringing in only $2.5 million.

Under the current deal, the federal government is giving 75 per cent of the federal cannabis excise duty generated in Saskatchewan to the province.

The province has said they will not share the pot revenue with municipalities, which doesn't sit well with Regina Mayor Michael Fougere.

Fougere said there need to be an agreement between the province and municipalities on how to distribute the revenue from cannabis.

"Let's have a system in place and an agreement to distribute the money, then we can talk about where the revenue goes," he said.

SGEU president Bob Bymoen said the province lost a huge opportunity to generate revenue from cannabis because they left the retail and wholesale of the product to private industry.

"Every other province the government has their fingers in wholesaling or the retaining, or both, and with that comes some of the revenue."

Like many jurisdictions, Saskatchewan marijuana sales were hindered by supply problems in the first months of legalization, with many stores closed due to lack of product. 

While marijuana revenues are expected to increase, the province is expecting a decline in other 'sin taxes' this year.

Tobacco taxes are expected to bring in $234 million dollars this year, a decline of $25 million from 2016.

Revenue from the Saskatchewan Liquor and Gaming Authority are also expected to drop. SLGA revenues are expected to bring in $477 million, a decrease of $10 million from predicted 2018 numbers.

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