Pubdate: Wed, 13 Jul 2016
Source: Globe and Mail (Canada)
Copyright: 2016 The Globe and Mail Company
Contact:  http://www.theglobeandmail.com/
Details: http://www.mapinc.org/media/168
Author: Ian Bailey

CITIES TO ASK FOR CUT OF LEGAL POT REVENUE

Three communities are using a meeting of B.C. municipalities to raise 
the issue of who gets what from any eventual taxes

Some British Columbia municipalities say Ottawa should share eventual 
tax revenues from the legalization of marijuana and are looking to 
put the issue on the political agenda through the annual gathering of 
B.C. municipalities.

A share of marijuana revenue could be a lucrative source of revenue 
for municipalities looking beyond such traditional sources as 
property taxes. According to a CIBC World Markets report issued 
earlier this year, federal and provincial governments could reap as 
much as $5-billion in revenue when recreational marijuana is 
legalized, which is expected to happen following legislation next year.

To make the case for a piece of the tax revenue, the B.C. communities 
of Prince George, Duncan and Nelson have submitted resolutions for 
debate at September's annual meeting of the Union of British Columbia 
Municipalities (UBCM). The meeting is expected to draw about 2,000 
delegates - 850 of them voting delegates - as well as key provincial 
and federal politicians, including Premier Christy Clark.

UBCM president Al Richmond said B.C. is at the forefront of the 
debate over the issue, noting he has heard nothing on the idea from 
elsewhere in Canada.

"It's sort of an emerging issue," said Mr. Richmond, noting 
municipalities are looking for new revenue sources beyond 
property-based taxation, as well as to finance possible increased 
policing costs associated with legalization.

Local governments across the country have been forced to deal with an 
unprecedented range of issues related to the legal, and illegal, 
sides of marijuana use in recent years, particularly since the 
federal Liberals' victory on a campaign promise to legalize the drug.

Dozens of illegal marijuana dispensaries have set up shop in 
Vancouver and Toronto, as well as in smaller communities, prompting 
some to draft regulations to license and control the shops. At the 
same time, municipal governments have struggled in recent years with 
where to allow federally approved medical cannabis facilities, and 
some have already raised concerns about keeping sales away from 
schools once the sale of recreational marijuana is legal.

When it comes to taxes raised through the new legal regime, Vancouver 
city councillor Raymond Louie, past president of the Federation of 
Canadian Municipalities, said he expects municipalities would get 
some share of pot-related revenues.

"If the federal government improves their revenue position through 
taxation on marijuana, I would expect that they would be able to 
better respond to our local government needs," he said in an e-mail statement.

A representative of the Federation of Canadian Municipalities said in 
a statement that the group is not in a position to comment on the 
issue, except to note that the organization will consult with its members.

Prince George Mayor Lyn Hall compared revenue from marijuana taxes to 
revenue from federal fuel taxes.

"If, in fact, laws change around marijuana and there's an opportunity 
for a taxation base to be built into that, I think we would view it 
similarly to how we view the current gas tax and it goes to various 
things in our community like many others. It could be infrastructure, 
roads, sidewalks," he said in an interview Tuesday.

He said the UBCM will be a terrific forum for pushing the idea - 
which, in the Prince George resolution, calls for local government to 
be part of the "marijuana taxation equation" - given the attendance 
of federal politicians, and the fact that the approach is coming from 
various parts of B.C. "I am optimistic about it. The timing couldn't 
be better," he said, referring to pending consultation on legalization.

Deb Kozak, the mayor of the Southern Interior B.C. city of Nelson, 
said pot-based revenues, expected to be significant, could be 
directed to education, health services and infrastructure needs in 
municipalities.

"That money could be well used in serving communities," she said.

The federal Liberal government has formed a task force, set to report 
by November, to help in the development of legislation to legalize 
the recreational use of marijuana by next year.

Nelson's resolution, for example, asks that the UBCM petition Ottawa 
for a share of revenues realized from the legalization and regulation 
of marijuana. It notes that legalization will lead to reduced 
enforcement costs for dealing with pot, freeing up some revenues.
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MAP posted-by: Jay Bergstrom