The federal Liberal government is reportedly set to table legislation to legalize recreational cannabis this Thursday. CTV News is reporting the government will release its long-awaited framework for recreational marijuana, which is expected to be in force by next July.
The bill will fulfill one of the election promises made by the Trudeau Liberals, but the Parliamentary Budget Officer has cautioned the effectiveness of Parliament Hill’s legislation may be compromised if the feds tax the commodity too heavily. In a report tabled by the PBO last November, the budget watchdog recommended $8-$9 per gram would be the sweet spot for bolstering federal revenue while still avoiding sending prospective customers to black market sources.
Questions remain over the legal age for purchasing recreational marijuana, as drinking ages vary by province. The exact nature of the supply chain is also up in the air, as marijuana was exempted from last week’s internal free trade agreement. The federal and provincial governments are forming a working group to help iron out cross-border movement of marijuana.
The news is likely a boon for the nascent domestic marijuana industry, including publicly-traded entities like Canopy Growth (WEED.TO) and Aphria (APH.TO). The space has seen explosive stock price moves on speculation of booming sales opportunities once recreational marijuana is legalized. However, the industry is concerned restrictions on branding could make it difficult to market their wares. Seven industry players wrote to Ottawa in March, arguing that preventing them from branding their products by mandating plain packaging could make it tougher to compete with illegal dispensaries and black market merchants.