Comments Regarding the Proposed Excise Duty Framework for Cannabis Products

Date de parution : 12/07/2017
Personne(s)-ressource(s) : Joan Weir

December 7, 2017

Department of Finance
Government of Canada
Proposed Excise Duty Framework for Cannabis Products

On behalf of the Canadian life and health insurance industry, we are writing to raise awareness of the insurance industry’s input about the proposed excise duty framework for cannabis products. The Canadian Life and Health Insurance Association is a voluntary association with member companies which account for 99 per cent of Canada’s life and health insurance business. In Canada, for calendar year 2016, the life and health insurance industry made payments of about $32.5 billion on health services for 25 million individuals covered by private plans. These plans help ensure Canadians have access to needed health care.

Coverage of medical cannabis is not a standard benefit offered by drug benefit plans. However, many drug benefit plans have companion healthcare spending accounts that provide coverage for products and services that are eligible under the Canada Revenue Agency’s medical expense tax credit, and this includes medical cannabis and seeds. In addition, some plan sponsors have elected to add coverage for medical cannabis to their drug benefit plans.

At the same time, the numbers of medical cannabis permit holders has continued to escalate. In June 2014 there were fewer than 8,000 permit holders; 3 years later, there are almost 300,000 and this growth trend is expected to continue.

There are many decisions that the governments must make as they consider their approach to legalization of recreational cannabis. By way of this letter, the CLHIA hopes to bring to your attention matters that may have an impact on whether individuals choose to obtain cannabis through the medical channel, as opposed to the recreational channel. Of particular interest will be the decisions made around taxation. We are pleased that the Government of Canada has considered the potential impact any taxation differential between medical and recreational cannabis may have on ‘pushing’ individuals into the medical system. CLHIA supports the equal application of the excise duty on all cannabis sold in Canada, as included in the proposed excise duty framework.

We thank the Government of Canada for your leadership on this important initiative, and for the opportunity for CLHIA to provide the health insurance industry’s perspective. Should you require any addition information, please feel free to contact me directly.

Joan Weir

Director, Health and Disability Policy