Five articles into this series, every regime examined has shared a structural feature: a business that falls behind can, in principle, trade its way back. The cannabis excise regime contains a provision that removes that possibility, and it is stated plainly in a CRA memorandum that most operators have read past.
Key Takeaway
Cannabis is regulated by CRA under the Excise Act, 2001 rather than under the income tax or GST/HST regimes, with a licence required since 17 October 2018 and a monthly return, Form B300, due by the last day of the following month whether or not there is anything to report. Duty on dried cannabis is reported as the greater of one dollar per gram or ten percent of value, and our own calculation shows the percentage component only exceeds the flat rate above ten dollars per gram wholesale, so across the price range the industry now occupies the flat charge governs and its share of revenue rises as prices fall. CRA's stamping memorandum states that a licensee will not be eligible to order excise stamps, and their order will be rejected, if they have outstanding returns. Since product intended for the duty-paid market cannot be removed from the premises unless packaged and stamped, a missed return can interrupt the ability to sell. Reported excise arrears grew from roughly $147,000 in 2019 to nearly $200 million, and directors are jointly and severally liable for unpaid duty.
A Note On Currency
Everything here is stated as verified in August 2026 and requires confirmation before reliance. Excise duty rates are published by CRA and change, and this sector has been the subject of sustained policy debate, so rates and rules may have moved.
CRA maintains a page of current excise duty rates covering cannabis products among others, together with rates in effect during the previous four years and the price payable to purchase excise stamps from the authorised stamp provider[1]. Any operator should work from that page rather than from any secondary account, including this one.
We have taken the framework from CRA memoranda and notices, and the financial and enforcement picture from trade reporting. We identify which is which, and we flag that the arrears figures are reported rather than officially published.
This is not legal or tax advice. The consequences in this regime include loss of the ability to operate, and any licensee with an emerging problem should obtain advice before, rather than after, a return is missed.
A Different Regulator Entirely
The framing a business owner from another sector needs, because the mental model does not transfer.
Cannabis excise sits under the Excise Act, 2001, administered by CRA's Excise and Specialty Tax Directorate, and CRA directs licensees with questions to their regional excise office[2].
Three structural differences from income tax matter, and this is our own analysis.
The duty attaches to the product rather than to profit. A producer owes duty on cannabis packaged and entered into the duty-paid market whether or not the business made money, and there is no equivalent of a loss year reducing the liability.
The obligation is monthly rather than annual, so arrears accumulate twelve times a year rather than once.
And the regime is licence-based, which means the regulator holds a permission the business needs in order to exist, in addition to holding a claim for money. That is the same structural feature described in this series' article on registered charities, arriving here through an entirely different statute.
A provincial government presentation summarising the programme makes the general point that the rules under this Act as administered by CRA are different from those a business will be used to[3].
The Licence, And What Happens Without One
The entry requirement, and the enforcement consequence stated in CRA's own publication.
CRA's excise news publication records that as of 17 October 2018 a cannabis licence under the Excise Act, 2001 is required to cultivate, produce or package cannabis products[4]. A memorandum states that every person who wishes to package cannabis products must hold such a licence[2].
The consequence of operating without one is stated directly. Entities not issued a cannabis licence by CRA as of that date who possess non-duty-paid cannabis products are not compliant with the Act, and could be subject to enforcement action including seizure and destruction of all cannabis products[4].
That phrase is worth pausing on because it has no analogue in the sectors this series has examined so far.
In an income tax dispute the asset remains with the taxpayer while the amount is argued. Here the enforcement power reaches the inventory itself, and destruction is not a realisation of value against the debt. It is the elimination of the asset.
For a business whose balance sheet is substantially biological and packaged inventory, that is a different order of exposure, and it explains why licence compliance is not an administrative matter to be managed alongside others.
The Monthly Return
The filing obligation, with its deadline stated precisely because it is easy to misremember.
CRA states that licensed cultivators, producers or packagers must file a return on Form B300, Cannabis Duty and Information Return, for each calendar month, and must send the completed return no later than the last day of the month that follows the calendar month to which the return relates. The example given is that persons accounting for duty starting in October 2018 must file their October return by 30 November 2018[4].
So the deadline is a month end rather than a fixed day number, and the window is roughly a month regardless of the length of the reporting month.
Commentary describes what the return requires, including reporting adjustments to net duty for matters such as bad debts, returned products, or cannabis taken for research and development; claiming eligible refunds with supporting documentation; and recording operational data covering quantities of cannabis product packaged, stamped, shipped, received, reworked or co-packaged[5].
We report that description from a legal publication rather than from the form itself, and an operator should work from the current form and its schedules.
The operational data requirement is the part worth flagging, and this is our own emphasis. The return is not merely a duty calculation; it is an information return about physical product movements, which means the filing depends on inventory records being accurate and current at each month end.
A producer whose warehouse reconciliation lags its filing deadline has a structural problem rather than a busy month.
Nil Returns Are Mandatory
A short section on a requirement that catches operators during quiet periods.
CRA states that even if there is nothing to report for a calendar month, licensees must send the completed return by the deadline[4].
The reason this matters more here than in most regimes is the interaction described later in this article.
A licensee that produced nothing in a month, and therefore owes nothing, might reasonably conclude that no filing is required. On CRA's stated position that conclusion is wrong, and the resulting outstanding return has consequences that extend beyond a late filing question.
This is a particular risk for operators who pause production, whether for seasonal reasons, financing difficulties, facility work, or while a sale process is under way.
Those are exactly the circumstances in which administrative attention is elsewhere, and exactly the circumstances in which the business can least afford the consequence.
The control is trivial: a recurring monthly obligation with a named owner, treated as unconditional rather than as contingent on there being activity to report.
The Duty Formula
The calculation, at the level of principle, with a strong caution about specifics.
Trade reporting describes the federal excise duty imposed on producers' dried cannabis as either one dollar per gram or ten percent of the value of the gram, whichever is greater[6].
Layered on that is an additional cannabis duty. CRA records that draft proposals released in September 2018 provided for additional cannabis duty rates for each province or territory that has signed a Coordinated Cannabis Taxation Agreement with the Government of Canada, and in certain provinces an adjustment to that additional rate, with the rates effective 17 October 2018 when non-medical cannabis became available for legal retail sale[4].
CRA directs readers to its notice on the calculation of cannabis duty and additional cannabis duty for detailed information[4], and we have not reproduced those calculations here.
Two further points. Trade reporting notes that different excise rules apply to various cannabis derivatives and other products[6], so the dried cannabis formula does not describe the whole regime.
And the rates are published and change[1].
What follows uses the reported dried cannabis formula to illustrate a structural property. It is an illustration of arithmetic rather than a statement of any operator's liability.
The Inversion Nobody Designed For
The analysis that explains the sector's financial position, and it is our own.
A duty expressed as the greater of a flat amount and a percentage behaves in two entirely different ways depending on price.
Above a certain price the percentage governs, and the duty is proportional. A producer selling at a higher price pays more, and the burden as a share of revenue is constant.
Below that price the flat amount governs, and the duty stops responding to price at all. The producer pays the same charge per gram whether the gram sells for four dollars or two, which means the burden as a share of revenue rises as prices fall.
Applying the reported one dollar per gram figure, our own calculations give the following. At ten dollars per gram wholesale the duty is ten percent of revenue. At five dollars it is twenty percent. At three dollars, one third. At two dollars, half. At one dollar, the entire wholesale price.
Now read that against the reported market conditions. Trade reporting describes producers suffering from a combination of industry-wide overproduction which is driving down prices, and high taxes at various levels of government[7].
Those two facts interact in the worst possible way. The condition that reduces revenue simultaneously increases the duty as a proportion of it.
A producer facing falling prices in an ordinary tax regime sees its tax fall with its margin. Here the charge is fixed per unit, so the same commercial pressure that reduces the ability to pay increases the relative amount owing.
Where The Percentage Actually Bites
A single number that clarifies the whole picture, computed by us from the reported formula.
The ten percent component only exceeds one dollar per gram when the value per gram exceeds ten dollars.
Below ten dollars per gram, the ad valorem component is irrelevant. The duty is the flat charge, full stop.
That reframes how the formula should be understood. A duty described as the greater of a flat rate and ten percent sounds like a percentage tax with a floor. In a market trading below ten dollars per gram wholesale it is a flat per-unit charge with a theoretical percentage that never engages.
We are not in a position to state current wholesale price levels and have not attempted to; that is an operator's own data and a matter of public market reporting. What we can say is that the ten dollar threshold is the number that determines which regime an operator is actually in, and it is worth knowing.
The observation also explains why the industry campaign described in trade reporting focuses on amending the tax rather than on rates generally. The chief executive of one producer is quoted describing the growth in total excise owing and in the number of licensed producers in arrears as indicative of a sector-wide inability to survive under current excise tax policy, and is described as having led a drive to convince the federal government to amend the tax[6].
We report that as an industry participant's characterisation, which is an interested view, and note it is consistent with the arithmetic above.
The Stamping Regime
The physical control mechanism, which is where this regime differs most from anything else in this series.
A CRA memorandum records that paragraph 158.09(1)(a) provides that no person is allowed to remove a cannabis product intended for the duty-paid market from the premises of a cannabis licensee unless the product is packaged and stamped to indicate that cannabis duty and any additional cannabis duty have been paid[2].
The stamp is therefore not a receipt. It is a precondition to lawful movement of the product.
Stamps are ordered from CRA and processed by an authorised stamp provider, with CRA maintaining the price payable to purchase them[1].
The memorandum describes the ordering process. CRA reviews each order to verify the eligibility of the licensee and the details of the order. Orders received by twelve noon Eastern time each business day are reviewed that business day; orders received after that are reviewed on the following business day. Once reviewed, CRA will either approve and release the order to the authorised stamp provider for processing, or reject it and provide justification to the licensee[2].
Licensees can elect to receive email notifications once orders are approved or rejected[2].
So every batch of stamps passes through a CRA review of the licensee's standing before it is issued. That review is the subject of the next section.
The Mechanism That Closes On Itself
The single most important sentence in this article, and it appears in a CRA memorandum without emphasis.
The memorandum states: a cannabis licensee will not be eligible to order cannabis excise stamps and their order will be rejected if they have outstanding returns[2].
Set that beside the two facts already established.
Product intended for the duty-paid market cannot be removed from the licensee's premises unless packaged and stamped[2]. And a return must be filed every month whether or not there is anything to report[4].
The consequence, which is our own analysis, is a loop that closes.
A licensee that misses a return cannot obtain stamps. Without stamps it cannot lawfully move finished product off the premises. Without moving product it cannot generate revenue. Without revenue it cannot pay the duty that is accruing, and it becomes progressively less able to bring its filings and payments current.
Most tax regimes permit a struggling business to keep trading while it works out an arrangement, because the regulator's claim is for money and the business's ability to earn money is what will satisfy it. This mechanism can suspend the ability to earn.
The practical instruction that follows is unusually stark and we would state it to any licensee: filing the return is a higher operational priority than paying the duty, because the filing gates the stamps and the stamps gate the revenue.
An operator without the cash to remit should still file. A filed return with an unpaid balance is a collections matter. An unfiled return is an operational shutdown risk.
Stamp Reconciliations
The audit technique specific to this regime.
The memorandum states that CRA periodically performs reconciliations of stamps to determine the level of compliance with the Act and its regulations[2].
The logic is worth setting out because it is a closed system, and this is our own analysis.
CRA knows exactly how many stamps each licensee ordered, because it approved each order. Each stamp corresponds to a package entering the duty-paid market, and each package carries a duty liability.
So the stamp count is an independent measure of duty that should have been reported, generated by the Agency's own records rather than by the licensee's.
That is a materially stronger position than the Agency occupies in the sectors examined earlier in this series. In residential construction it had to obtain permits from municipalities; in restaurants it had to examine a point-of-sale database. Here the third-party record is its own.
The reconciliation therefore runs in both directions. Stamps issued but not accounted for in returns suggest unreported duty. And stamps unaccounted for in the licensee's own records suggest a control failure, which is the subject of the next section.
Unaccounted Stamps
A discrete exposure that operators consistently underestimate.
A provincial government presentation summarising the CRA programme states plainly that there is a penalty for unaccounted cannabis excise stamps[3].
We report that as stated in a government summary and have not verified the penalty's amount or its statutory source, and an operator should establish both.
The structural point stands regardless of the figure, and it is ours.
A stamp in a licensee's possession is a controlled item representing a duty liability. It is not stationery. Damaged stamps, spoiled application, stamps applied to product later reworked, and stamps simply lost in a production environment all create a gap between what was issued and what can be accounted for.
Every one of those events is ordinary in manufacturing. None of them is ordinary in a regime that penalises unaccounted stamps.
The control that addresses it is inventory discipline applied to the stamps themselves: sequential records of receipt, application, spoilage and destruction, reconciled to the order records, with spoilage documented as it occurs rather than explained afterwards.
An operator that can reconcile its stamps to CRA's own order records at any time is in a strong position in a reconciliation. One that cannot is in a weak position irrespective of whether any duty was actually evaded.
The Debt Curve
The sector's aggregate position, reported by trade press rather than published officially.
Trade reporting gives a series for total cannabis excise owing: roughly $147,425 in 2019, $4.4 million in 2020, and $16 million in 2021[6], with a 2024 report describing unpaid cannabis tax as having ballooned to almost $200 million[6].
We report these as trade press figures. CRA declined to release related information, telling the same publication that it does not release information that could jeopardise the integrity of the tax system[6], so these numbers have not been officially confirmed to our knowledge.
Taken at face value, the growth rates are our own calculation: roughly thirtyfold from 2019 to 2020, roughly 3.6 times from 2020 to 2021, and roughly twelvefold from 2021 to the later figure. Across the whole period the multiple is on the order of a thousandfold.
Growth of that shape is not a collections problem. A collections problem produces a rising balance that tracks activity; this tracks nothing in the underlying business except the duty accruing faster than the sector can pay it.
The arithmetic in the earlier sections supplies a mechanism. A flat per-unit charge in a market with falling prices produces exactly this curve, because the liability is a function of volume while the ability to pay is a function of price.
We would treat the specific figures as indicative rather than precise, and the trajectory as the finding.
Two Thirds Of The Sector
A proportion that changes how an operator should read its own position.
Trade reporting states that roughly two-thirds of cannabis businesses regulated by the federal government had an excise deficit owed to CRA[7].
We report that as trade press and unverified.
If broadly accurate, two consequences follow and both are ours.
Being in arrears is not, in this sector, an indicator that a particular business is poorly run. It is the majority condition, which means an operator in arrears should not assume its position is idiosyncratic or that a bespoke accommodation is likely.
And conversely, an operator that is current occupies a distinctive position. In a regime where the regulator gates access to stamps on filing status, being among the compliant third is an operational advantage rather than merely a compliance virtue.
There is a third implication for anyone acquiring or lending into this sector. A duty arrear is a liability that travels with the licence-holder, it accrues interest, and as the next sections show it reaches directors personally and can be enforced against plant and equipment. Diligence in this sector should treat the excise account as a primary enquiry rather than a routine one.
Fourteen Days
The enforcement communication, quoted as reported.
Trade reporting describes a letter CRA sent to a licensed producer under the subject line "Legal warning about your cannabis duty debt," warning the business that if it does not pay the full amount or respond within 14 days, the Agency may enforce the cannabis duty provisions of the Excise Act, 2001 without further notice[6][7].
We report this as trade press describing a document it obtained; we have not seen the letter.
Two features of the quoted wording are worth noting, and this is our own reading.
The alternative offered is to pay the full amount or respond. A licensee unable to pay is not therefore unable to comply with the letter, and responding within the period is materially different from ignoring it.
And the phrase without further notice signals that the letter is the final procedural step before enforcement rather than one in a sequence. An operator treating it as the first of several warnings has misread it.
The publication notes that a company it spoke to requested anonymity, fearing that publicity could jeopardise talks with CRA[7], which indicates that negotiated arrangements do occur and that operators regard them as fragile.
The practical instruction is to respond within the stated period, in writing, with representation, whether or not payment is possible.
The Collection Tools
What enforcement looks like in practice, as reported.
Trade reporting states that CRA is said to be raising the possibility of garnishment, liens on plant property and equipment, and legal action[7].
We report that as trade press characterising what producers say they were told.
The reference to liens on plant property and equipment deserves separate attention, and this is our own analysis.
Cannabis production is capital intensive. Facilities carry purpose-built infrastructure, and that equipment is frequently the security for the business's lending.
A revenue claim asserted against that equipment therefore interacts with existing secured creditors, and the emergence of a Crown claim in that position can trigger covenant consequences with lenders independently of what CRA ultimately does.
So the enforcement risk in this sector is not confined to the relationship with the Agency. It reaches the capital structure, and a licensee in arrears should assume its lenders will need to be told before they discover it.
Combined with the stamp mechanism described earlier, the position is that a licensee in difficulty faces simultaneous pressure on its ability to sell, its equipment, and its financing.
Directors Are Personally Liable
The provision every board member in this sector needs to have read, quoted as reported from the Act.
Trade reporting quotes the legislation: if a corporation fails to pay any duty or interest as and when required under the Act, the directors of the corporation at the time it was required to pay the duty or interest are jointly and severally or solidarily liable, together with the corporation, to pay the duty or interest and any interest that is payable on the duty or interest under the Act[7].
We report that quotation as it appears in trade press and have not verified it against the statutory text; the provision's current wording, and any conditions or defences attaching to it, should be confirmed with counsel.
Three observations, all ours.
The liability attaches to the directors at the time the duty was required to be paid. That fixes exposure by reference to a historical date rather than to present office, which has consequences for anyone who has resigned and anyone considering joining a board.
It is joint and several, which means the Agency is not required to apportion, and a single solvent director can be pursued for the whole.
And it extends to interest, which in a regime where arrears have compounded over years may be a substantial component.
This publication treats director liability for source deductions and GST separately, and the structure will be familiar to readers of that article. The point specific to this sector is that the amounts at stake are unusually large relative to the size of the businesses, and that the majority-in-arrears figure reported above implies a large number of directors carrying exposure they may not have quantified.
A director in this sector should establish, in writing, the corporation's current excise filing and payment status, and should do so as a matter of routine governance rather than in response to a letter.
The Licence Is Also At Risk
The terminal consequence, which parallels the charities article in this series.
Commentary states that any deviation, including inaccurate reporting, late filing, incorrect duty calculations, or failure to maintain adequate records as prescribed by the Act, can trigger substantial repercussions extending beyond financial penalties and interest, and that CRA may initiate more severe enforcement actions such as comprehensive audits, with significant or repeated non-compliance potentially leading to the suspension or even revocation of a cannabis licence[5].
We report that as a legal publication's characterisation rather than as a statutory provision we verified.
The same source describes late filing penalties as typically multifaceted, with a penalty for failing to file on time often calculated as a percentage of the amount owing and potentially increasing with the duration of the delay, and interest charged on unpaid duties from the day after they were due and also on unpaid penalties[5].
We have deliberately not repeated any specific penalty figure, because the source describes the structure in general terms and we could not verify amounts. An operator should obtain the current amounts from CRA's own materials.
The phrase significant or repeated echoes the charities regime almost exactly, and the same lesson applies. Repetition is a distinct trigger from severity, which means the response to a first administrative failure determines a great deal about what follows.
What The Auditor Actually Examines
The enquiry in practice, structured by the regime's own control points. This section is our own analysis.
Stamps ordered against duty reported. The reconciliation described in CRA's memorandum, run from the Agency's own order records.
Physical inventory against reported movements. Quantities packaged, stamped, shipped, received, reworked and co-packaged are reportable on the return[5], so the underlying inventory system is the substantiation.
Product classification. Because different rules apply to derivatives and other product forms[6], how a product was categorised determines the duty, and classification is a judgment that can be revisited.
Valuation. Where an ad valorem component applies, the value used is a figure the licensee determined, and related-party or intercompany sales invite scrutiny of whether that value is arm's length.
Adjustments claimed. Bad debts, returns, and product taken for research and development each reduce net duty[5], and each requires evidence that the underlying event occurred as described.
Waste and destruction. Product destroyed rather than sold should not bear duty, and the destruction records are what establish that. In a regime this tightly controlled, undocumented destruction looks identical to undocumented diversion.
That last point is the one we would emphasise to any producer. The gap between product grown and product sold is large in this industry for entirely legitimate horticultural reasons, and the records explaining it are the difference between an ordinary reconciliation and a serious enquiry.
What Records Survive
A stamp register. Sequential, reconciled to CRA order records, recording receipt, application, spoilage and destruction with dates and responsible individuals.
Destruction records, witnessed and contemporaneous. Covering both product and stamps, created at the time and signed.
Month-end inventory reconciliations completed before the return is filed rather than after, since the return depends on them.
Proof of filing for every month, including nil months, because filing status gates stamp eligibility and the evidence of having filed is what resolves a dispute about it.
Classification decisions documented, recording why a product was treated as it was and on what basis.
Valuation support for any transaction where value drives the duty, particularly with related parties.
Adjustment support for bad debts, returns and research use.
A current statement of the excise account reported to the board, given the personal liability discussed above.
The View From The Board
A short section addressed to directors, because this regime's governance implications are unusual.
A director of a licensed producer holds a position in which, on the reported provision, unpaid duty becomes a personal liability[7], and in which a missed administrative filing can interrupt the company's ability to sell[2].
Three questions follow, and they are ours.
Are all returns filed to date, including nil returns, and who confirms it monthly. This is the question that gates stamps and therefore revenue.
What is the current excise balance, and what is the trend over the last twelve months. Given the reported sector-wide trajectory, a balance that is growing rather than merely large is the signal.
If we received a fourteen-day letter tomorrow, who would respond and with what authority. Responding within the period is possible even when paying is not, and the time to establish who does it is before it arrives.
None of the three requires financial capacity. All three address the mechanisms that convert a difficult trading position into an existential one.
What To Do
File every month, including nil months, without exception. Filing gates stamps, stamps gate lawful movement of product, and product movement gates revenue.
Treat filing as a higher operational priority than paying. An unpaid filed return is a collections matter; an unfiled return is a shutdown risk.
Know which side of ten dollars per gram you are on. Below it the ad valorem component never engages and the duty is a flat per-unit charge whose share of revenue rises as prices fall.
Run a stamp register and reconcile it to CRA order records. The Agency performs its own reconciliation from records it created, and there is a penalty for unaccounted stamps.
Document destruction contemporaneously and have it witnessed. Undocumented destruction is indistinguishable from undocumented diversion.
Complete inventory reconciliation before filing, not after. The return is an information return about physical movements, so the inventory system is the filing.
Respond to a fourteen-day letter within fourteen days, in writing, with representation. The letter offers payment or response, and without further notice means what it says.
Tell your lenders before they find out. Liens on plant and equipment interact with existing security and can trigger covenant consequences independently.
Directors: establish the filing and payment position in writing, now. Liability attaches to directors at the time payment was required, is joint and several, and extends to interest.
Work from CRA's published rate page for every figure. Rates change and secondary accounts, including this one, go stale.
The Limits Of This Analysis
Several caveats matter and they are significant in this article. This is not legal or tax advice; the consequences in this regime include loss of the ability to operate, and any licensee with an emerging problem should obtain advice immediately. Everything is stated as verified in August 2026 and requires confirmation; excise rates are published by CRA, change over time, and should be taken from that source. The duty formula for dried cannabis is reported from trade press rather than from the legislation, we have not reproduced the calculation of additional cannabis duty or the provincial adjustments, and different rules apply to derivatives and other product forms that we have not addressed. The duty burden percentages are our own arithmetic applied to a reported formula and are illustrative rather than a statement of any operator's liability; we have not asserted current wholesale prices. Arrears figures come from trade reporting, CRA declined to release related information, and the numbers are not officially confirmed to our knowledge. The two-thirds in arrears figure, the enforcement letter, the reference to garnishment and liens, and the quoted director liability provision all reach us through trade press; the statutory quotation in particular has not been verified against the Act, and its current wording, conditions and any available defences should be confirmed with counsel. The description of penalties for late filing and of licence suspension or revocation comes from a legal publication rather than from provisions we verified, and we have deliberately declined to state any penalty amount. The penalty for unaccounted stamps is reported from a provincial government summary without amount or statutory source. The closed-loop analysis, the price inversion argument, the ten dollar breakeven, the observations on lender interaction and destruction records, the audit examination structure and the board questions are our own analysis. This article does not address provincial cannabis regulation, licensing under the Cannabis Act, retail regulation, medical cannabis rules, or the income tax and GST/HST positions of these businesses.
Frequently Asked Questions
What happens if we miss a monthly return?
Do we file if there was no production that month?
Why does the duty feel heavier as prices fall?
Are directors personally exposed?
How does CRA check our numbers?
What should we do with a fourteen-day warning letter?
References
- Canada Revenue Agency. Excise Duty Rates, providing the rates of excise duties imposed under the Excise Act, 2001 on cannabis products among other goods, the rates in effect during the previous four years where applicable, and the price payable to purchase excise stamps for cannabis, tobacco and vaping products from the CRA authorized stamp provider. Note: a CRA primary publication and the authoritative source for current rates; readers should work from it directly. canada.ca — Excise duty rates
- Canada Revenue Agency. Excise Duty Memorandum EDM6-1, General Information on the Possession, Sale, and Distribution of Cannabis Products and the Cannabis Stamping Regime, on the requirement that every person wishing to package cannabis products hold a cannabis licence; on paragraph 158.09(1)(a) providing that no person may remove a cannabis product intended for the duty-paid market from a licensee's premises unless packaged and stamped to indicate that cannabis duty and any additional cannabis duty have been paid; on CRA reviewing each stamp order to verify licensee eligibility and order details; on CRA periodically performing reconciliations of stamps to determine the level of compliance; on the same-day and next-business-day review timings; on approval and release to the authorized stamp provider or rejection with justification; on the statement that a licensee will not be eligible to order stamps and their order will be rejected if they have outstanding returns; on optional email notification of order outcomes; and on referral to the Act, regulations or a regional excise office. Note: a CRA primary publication. canada.ca — EDM6-1
- Government of British Columbia. Cannabis Taxation Program: Canada Revenue Agency Presentation, on the programme being based on the Excise Act, 2001 and its regulations, on the observation that the rules under that Act as administered by CRA are different, on excise licences and registrations, and on the existence of a penalty for unaccounted cannabis excise stamps. Note: a provincial government publication reproducing a CRA presentation; the penalty is stated without amount or statutory source and we did not verify either. gov.bc.ca
- Canada Revenue Agency. Excise and GST/HST News No. 105, November 2018 (archived), on the requirement from 17 October 2018 for a cannabis licence under the Excise Act, 2001 to cultivate, produce or package cannabis products; on entities not licensed as of that date who possess non-duty-paid cannabis products being non-compliant and subject to enforcement action including seizure and destruction of all cannabis products; on the requirement for licensed cultivators, producers or packagers to file Form B300 for each calendar month no later than the last day of the following month, with the worked example; on the requirement to file even where there is nothing to report; and on the September 2018 draft proposals providing additional cannabis duty rates for provinces and territories that signed Coordinated Cannabis Taxation Agreements, with adjustments in certain provinces, effective 17 October 2018. Note: an archived CRA publication describing the regime at inception; current requirements should be confirmed. canada.ca — Excise and GST/HST News No. 105
- Substance Law. (2025, June 17). B300 Excise Duty Return for Cannabis Producers, on the content of the return including adjustments to net duty for bad debts, returned products and cannabis taken for research and development, refund claims requiring supporting documentation, and the recording of operational data covering quantities packaged, stamped, shipped, received, reworked or co-packaged; and on the consequences of deviation including inaccurate reporting, late filing, incorrect duty calculations or failure to maintain adequate records, extending to comprehensive audits and, for significant or repeated non-compliance, suspension or revocation of a cannabis licence, together with a general description of late filing penalties and interest. Note: a Canadian law firm publication; penalty amounts were described in general terms and we have not repeated any figure. substancelaw.ca
- MJBizDaily. (2024). Unpaid Cannabis Tax in Canada Balloons to Almost CA$200 Million, on the reported series of total excise owing of approximately $147,425 in 2019, $4.4 million in 2020 and $16 million in 2021; on the federal excise duty on producers' dried cannabis being either one dollar per gram or ten percent of the value of the gram, whichever is greater; on different excise rules applying to various cannabis derivatives and other products; on the CRA warning letter under the subject line regarding cannabis duty debt and the fourteen-day wording; on CRA declining to say how many such letters were sent, stating it does not release information that could jeopardise the integrity of the tax system; and on an industry chief executive's characterisation of the growth in arrears as indicative of a sector-wide inability to survive under current excise tax policy. Note: trade press; figures are not officially confirmed and the industry characterisation is an interested view. mjbizdaily.com
- MJBizDaily. (2023, May 22). Canada's Tax Agency Steps Up Pressure on Cannabis Excise Debt, on the reported CRA warning letter and its wording; on CRA being said to be raising the possibility of garnishment, liens on plant property and equipment, and legal action; on a company requesting anonymity for fear that publicity could jeopardise talks with CRA; on producers suffering from industry-wide overproduction driving down prices combined with high taxes at various levels of government; on roughly two-thirds of federally regulated cannabis businesses having an excise deficit owed to CRA; and for the quoted statutory provision making directors of a corporation that fails to pay duty or interest jointly and severally or solidarily liable together with the corporation, including for interest. Note: trade press; the statutory quotation has not been verified against the Act and its current wording, conditions and defences should be confirmed with counsel. mjbizdaily.com
This article is provided for general informational purposes and is not legal or tax advice. Excise duty rates are published by CRA, change over time, and should be taken from that source rather than from this article. Arrears figures, the enforcement letter and the quoted director liability provision reach the authors through trade reporting and are not officially confirmed. Duty burden percentages are the authors' arithmetic applied to a reported formula and are illustrative only. Any licensee with an emerging compliance problem should obtain professional advice immediately.