Insiders in the Canadian marijuana industry claim a new federal “cannabis strategy table” that brings together business executives and government representatives will provide a forum for talking about important issues including excise taxes, marketing limitations, and THC caps on edibles and beverages.
In its most recent budget, the Canadian government disclosed the cannabis strategy table.
The strategy document was put together about four years after Canada’s historic Cannabis Act, which made it possible for that country to become the first major industrialized one to enact government legalization of recreational marijuana.
The subjects that industry participants hope to discuss during the roundtable overlap with those that they hope to address when the long-overdue legislative review of the Cannabis Act finally gets underway.
Industry stakeholders, however, voiced optimism for novel solutions to such problems given the next strategy table’s focus on promoting economic growth.
Omar Yar Khan, senior vice president of corporate and public affairs, said: “Part of our frustration as an industry over the last few years has been, anytime we want to have a holistic discussion with government about the challenges and opportunities facing industry – and how can government and industry partner to overcome the challenges and also take advantage of the opportunities – we’ve always just been referred to Health Canada, and that’s not really in their mandate.”
In addition to working together on issues relating to the cannabis industry, stakeholders said the establishment of the economic strategy table represents a turning point for Canada’s legalized cannabis industry, which will now join other significant industries as the focus of special government attention and collaboration.
A “good first step” is having a table with both the government and business leading it, according to Khan.
The government is acknowledging that our industry matters, but the results will be the real judge.
workings of economic strategy tables
Given that the forum has not yet been properly launched, official information on the cannabis strategy table is still lacking.
The federal agency that works to advance the Canadian economy and promote innovation, Innovation, Science and Economic Development Canada (ISED), formerly known as Industry Canada, will be in charge of the table.
The strategy table is intended to be “an open and continuing dialogue… with the legal cannabis sector about prospects for, and impediments to, economic growth,” ISED said in a statement to MJBizDaily.
The department promised more information soon.
ISED also offers the following seven economic strategy tables:
advanced production.
Agri-food.
digital businesses.
biology and health.
new technology
Tourism.
future resource availability.
Economic strategy tables typically meet once a month with the goal of formalizing and advancing sectoral growth objectives, according to Sherry Boodram, co-founder and CEO of Canadian cannabis consultancy CannDelta.
Basically, Boodram said, “the government is aiming to interact with important stakeholders that are a part of a significant high-impact economic sector; actually, any sector that might influence Canada’s economic growth.”
By creating these strategy tables, which are mostly driven by industry, the government tries to do things in a really strategic way so they can have very efficient dialogues about it.
Boodram stated that other industry strategy tables also get together to talk about places where their interests intersect.
According to High Tide’s Khan, current economic strategy tables are co-chaired by an industry CEO and a deputy minister from the Canadian federal government. He anticipates the cannabis table to have a similar leadership structure.
Khan claimed that ISED acts as a point of contact between the cannabis industry and several government agencies so that “holistic talks can happen, so they’re not happening in silos,” while he conceded that other agencies still retain the final say in any rules that affect the sector.
The president and chief executive officer of the industry group Cannabis Council of Canada, George Smitherman, anticipates that the table will provide yet another avenue “by which we can actually begin to be proponents for proactive, growth-related policies,” which he said have been “impossible” in discussions with Health Canada and challenging with Finance Canada and the country’s tax authority, the Canada Revenue Agency.
So, you’d think that this would give the economic framework a place to frame up a lot of the strategy and tactics that might come from it.
Key points to bring up
Smitherman stated that given the current situation of the economy, he anticipates that the business community will continue to raise issues such as “an excise tax that is unduly harsh and a collection of nanny-state rules that are really, really, really suffocating people.”
Producers want the tax to be changed since several Canadian cannabis businesses owe the government unpaid excise fees.
The strategy table, according to Khan of High Tide, should provide an opportunity to set benchmarks for business and governmental accomplishments in the upcoming years, then check in on those targets to gauge progress.
For the next five years, Khan added, “we’re going to want to engage with the government and this table to build a road map for industrial success.”
Once the roadmap has been decided upon, though, we’ll also want to hold them accountable and keep them on their toes.
Khan claims that changing the THC cap on each package of edibles and beverage container—which is currently set at a maximum of 10 milligrams of THC—will be a topic of debate.
Although public health is crucial, he added, “we also want to have these discussions in the context of how they will affect our capacity to compete with the black market.”
The cannabis industry in Canada has the potential to “advance toward becoming a more sustainable industry, with chances for actual economic growth,” according to industry expert Boodram.
She stated that this might entail changing the laws governing cannabis marketing and advertising “to allow for critical performance factors such as brand awareness, differentiation, and cost leadership.”
Beyond the few technical changes mentioned in the most recent budget, Boodram wants to see reform of the cannabis excise tax.
For some of the smaller players, Boodram said, “I think it would also be excellent if they spoke about supporting programs for greater funding prospects and employment development.”
Industry development
Whatever the strategy table ultimately achieves, its existence, according to industry supporters, marks a symbolic maturing for Canada’s legalized cannabis market.
The fact that Minister of Finance Chrystia Freeland wanted this to be a part of her budget, according to Khan of High Tide, “suggests that there is a high-level recognition within the government of the importance of this industry to Canadian families, to Canadian jobs, and to Canadian economic growth.”
“A big victory for the business,” according to Boodram, is the government’s acknowledgement of cannabis as a “legitimate, high-impact economic contributor worth focusing on.”
Boodram praised the industry’s recognition as a high-impact sector that has the potential to boost Canada’s economy and be competitive on a global scale.
Cannabis Council CEO Smitherman expressed optimism that the table would aid the industry in enacting change, “especially because it comes as a sign of recognition, alongside a few other signs” like the most recent changes to the excise tax and the suggested increase in possession limits for cannabis-infused beverages.
