Alberta to impose its own 10-per-cent tax on cannabis producers

The province plans to tax licensed producers 10 per cent of the retail price when cannabis becomes legal.

The new tax was announced Thursday when Finance Minister Joe Ceci tabled the 2018-19 provincial budget.

The amount Alberta will collect from the tax comes on top of the 75-per-cent cut all provinces will get fromthe federal tax on marijuana, a split Ottawa agreed to earlier this year.

Alberta is the only province in Canada to not have a sales tax. All Canadians pay thefive-per-cent federal goods and services tax.

Ceci said the federal government will collect the levy from producers and distribute it back to the province.

"Because we don't have a PST in this province, they are going to be assisting us in the collection of taxation," Ceci said.

Having the federal government collect the tax minimizes administration costs for the province and "compliance costs" for businesses, according to the budget.

The 10-per-cent tax is estimated to earn the province $26 million in 2018-2019 and $80 million in 2020-2021.

Ceci said the provinces and Ottawa have agreed cannabis should be similarly priced across the country.

Revenues are expected to grow as the "legal market gradually takes market share away from the illegal market," the budget document said.

The budget does not specify an amount or percentage municipalities will get from tax revenues.

Edmonton Mayor Don Iveson has urged the province to decide on an amountor a percentage to be given to cities and towns to help cover costs of police and enforcing new bylaws.

• Weed revenues on Edmonton mayor's wish list for Ottawa trip
• 'We're not ready': Edmonton police brace for marijuana legalization, chief says
• Despite uncertainty and tight timeline, city will be ready for legal pot, councillor says

The city estimates it will spend $4.5 million on changing and enforcing new bylaws andbetween $5 million and 7 million for increased policing costs.

The province is already spending $69 million to get ready for legalization, Cecisaid.

Ceci added heneeds more information from Ottawa before he willdiscuss a cut with municipalities.

The Alberta Gaming and Liquor Commission is also able to take a markup on sales made through the online system, with the amount limited to covering the costs of the AGLC's operations.

@natashariebe