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What Canada’s Legal Cannabis Market Can Teach U.S. Producers and Policy Makers

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1 day agoon

Close to seven years after cannabis was legalized for recreational use in Canada, many lessons of what went right and wrong north of the border offers a range of lessons for American cannabis producers and policy makers.
For one, the fact that the federal government passed the Cannabis Act nationally in 2018 was a vital step forward, said Ben Kaplan, a Toronto-based author of the recently published book “Catch a Fire: The Blaze and Bust of the Canadian Cannabis Industry.” And a valuable lesson for prohibitionists.
“Cannabis got legalized and the sky didn’t fall,” Kaplan said in an interview with Cannabis Business Times, “and we created an industry that shared what they knew from the CPG space, which gave companies the ability to produce, ship, seal and deliver the products like any other widget.” Courtesy Ben Kaplan
Trina Fraser, a lawyer with Ottawa-based Brazeau Seller Law who specializes in the cannabis sector, echoed Kaplan, adding, “It was a Justin Trudeau campaign promise he kept once elected, and the doom-and-gloom opponents for cannabis legalization were proven wrong.”
Kaplan noted how 2018’s legislation also spurred job growth and an economic boom the country. Figures from Statistics Canada point to how the cannabis sector contributed $7.7 billion (all figures Canadian) to Canada’s GDP in 2023, surpassing that of breweries, wineries, and distilleries combined, as StratCann reported.
Legalization also created 98,000 jobs annually, on average between 2018 and 2021, according to a Deloitte report. In the U.S., the still-young cannabis industry already employs more than 440,000 (full time), according to the “2024 Vangst Jobs Report.” And, a “2022 Leafly Jobs Report” cited by NORML suggested that as the cannabis market matures, employment numbers could skyrocket to 1.5 million to 1.75 million.
Sam Gibbons, senior vice president of corporate affairs for cannabis and produce business Village Farms, lauded Canada’s consumption rates, attributing that in part to the availability of quality products consumers return to again and again. “Seventy-five percent of the total market in Canada has migrated to the legal market (approximately 25% remains through illicit market), which is a great reflection of a successful market if one of the intentions of legalization is to eliminate illicit activity,” he said.
Village Farms operates in Canada mainly under the Pure Sunfarms brand, according to Gibbons, and sells hemp-derived CBD products in most U.S. states under the Balanced Health Botanicals label.Attorney Trina FraserCourtesy Brazeau Seller Law
Both through educating the public and Canadians normalizing what was once an illegal drug, communities didn’t later contest the many cannabis stores dotting neighborhoods, even though some eyebrows were raised at first, Fraser said. She added, “But safety issues never really came up with these stores, and now no one bats an eyelash anymore at all these stores popping up.”
Success Pockmarked by High Taxes, Over-Valuations
But the government, Health Canada—which is the primary government body that oversees regulated cannabis—and licensed producers made many missteps since 2018. For one, the taxing regime is more onerous in Canada compared to some states in the U.S., especially when examining the excise tax issue.
On the list of “here’s what not to do, America,” Fraser pointed to the financially painful excise tax that was created by the federal government to cover expected costs related to policing, health care and policing.
But the legal industry “actually lowered costs in so many of those areas, and this tax has killed many smaller businesses, and only left the major players like Tilray and Organigram standing, and it was created to help with policing and criminality,” she said.
How does this tax work?
- Dried and Fresh Cannabis: The federal duty is the greater of (in Canadian dollars):
- $0.25 per gram of flowering material, OR
- 2.5% of the producer’s selling price (dutiable amount).
- Cannabis Oils, Edibles, Extracts, and Topicals: Subject to a flat-rate duty of $0.0025 per milligram of total THC content.
- Cannabis Plants and Seeds: These are taxed at $0.25 per plant or per seed, or 2.5% of the dutiable amount (whichever is greater).
“It’s already so costly to run a cannabis business in Canada, and this tax is a systemic issue the Government has failed to address,” said Fraser.
Gibbons said Village Farms often has to pay up to $1 per gram in excise taxes, a burden he would like to see changed if lobbyist are successful at reforming the Cannabis Act. So far, no substantive changes are ahead, except for smaller policy changes such as cannabis storefronts being allowed to showcase cannabis products in their window displays.
While federal legalization in the U.S. still seems far out of reach, in some states in the U.S., higher taxes are already foretelling a challenging future for producers. Jerred Kiloh, president of the United Cannabis Business Association, told SFGate that when California increases its state cannabis tax rate from 15% to 19% on July 1, the higher tax rate could result in more businesses closing as the price of legal cannabis will just be “too far away” from the illicit market’s prices.
RELATED: California’s Cannabis Excise Tax Will Increase by 27% on July 1, CDTFA Announces
Over-valuation and hype also foretold a gap between expectation and reality. Publicly traded Canadian cannabis companies lost around $131 billion and massive Canadian cannabis companies such as Canopy and Aurora gave up to 97% of their value since hitting soaring market highs in 2019, according to a Toronto Star article Kaplan wrote.Ben Kaplan, author of “Catch a Fire: The Blaze and Bust of the Canadian Cannabis Industry” Courtesy Ben Kaplan
Canopy sold its headquarters in Smiths Falls, Ontario, and Aurora has been shutting facilities and cutting staff since 2020. “When the market was just beginning, you could basically say anything because no one knew about this brand-new product,” said Kaplan, “and that’s why we saw tobacco and alcohol companies want to enter the space.”
But expectations were so high, when the reality of a heavily supplied and highly regulated market came to pass, over-valuations forced market contraction, the loss of thousands of jobs, and “many investors losing their shirts quickly,” as Kaplan put it.
For anyone following the rise and fall of Med Men, this story sounds familiar.
As much as Canadian cannabis consolidated to a handful of market-leading companies due to M&A activity and producers falling off the map, Kaplan cautions it’s still early. “We’re really only in the second inning of legalization, and look at how long the alcohol industry had to get its footing back after Prohibition,” he said.
Paolo De Luca, chief strategy officer at Organigram Global, which also operates in the U.S. and Canada, said the early days of his company had them tread down a rougher path than their competitors. “We didn’t have access to the same amount of capital of some of the bigger players like Canopy and Aurora, so we were forced to be a bit scrappier with that that money, and I think that really helped us long-term,” he said.
A lesson for all producers in both countries is to invest early in R&D, added De Luca. “To differentiate from competitors, we wanted a competitive advantage and that came down to getting down the cost curve of production and creating high-quality flower early on,” he said.
A legal market also gave a boost in the arm to researchers. Canadian studies into the health efficacy of cannabinoids such as CBD and CBG have been encouraging for producers who want to see more scientific evidence their product is safe and potentially healthy. In fact, in 2019 the Government of Canada announced $24.5 million Canadian in funding for cannabis research.
Kaplan said, “This is something the U.S. can learn from, and if they put more money into academic studies on, say, how cannabis can help alleviate the opioid crisis, it’s a win-win.”
David Silverberg is a freelance journalist who writes about cannabis and the cannabis industry.

Author: mscannabiz.com
MScannaBIZ for all you Mississippi Cannabis News and Information.
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Mississippi Band of Choctaw Indians Approve Referendum Allowing Tribe to Explore Cannabis Legalization

Published
48 minutes agoon
June 12, 2025
The Mississippi Band of Choctaw Indians on Tuesday approved a referendum allowing the Tribe to develop “legislation to decriminalize and regulate possession, production, and distribution of marijuana on Tribal lands.” Referendum no. 2025-01 passed 1,367 to 1,110, according to a Facebook post.
The Band of Choctaw Indians is the only federally recognized Tribe in Mississippi and controls about 35,000 acres across 10 counties in the eastern part of the state.
According to the referendum, the approval will allow the Tribe to conduct a comprehensive study on enacting both medical and adult-use cannabis reforms, which would lead to cannabis cultivation and retail cannabis sales on tribal lands. The Tribe estimates the cost of hiring a consultant to conduct the study to run about $100,000.
The referendum was approved by a plurality of voters in seven of nine jurisdictions, with voters in Bogue Chitto, BC-Henning, Bogue Homa, Crystal Ridge, Pearl River, Red Water, and Tucker voting in favor, while voters in Conehatta and Standing Pine opposed.
Under current tribal law, criminal penalties are removed for Mississippi medical cannabis cardholders who possess legal limits on tribal lands. The referendum notes that cannabis remains outlawed federally but that federal enforcement of cannabis laws “has been limited.”
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Hawaii Gov. Vetoes Medical Cannabis Telehealth Bill Over Privacy Concerns

Published
2 hours agoon
June 12, 2025
Hawaii Gov. Josh Green (D) has vetoed a bill that would have allowed medical cannabis patients to get certified by a physician for the state’s cannabis program via telehealth, established criminal penalties for unlicensed operation of a medical cannabis dispensary, and prohibited cannabis cultivation without a Department of Health-issued permit.
In his veto message, Green, a medical doctor, focused on the bill’s telehealth provisions, claiming that they authorize “the inspection of patients’ medical records without warrant,” which constitutes “a grave violation of privacy.”
“Given that the federal government classifies cannabis as a Schedule I substance, patients’ reasonable fears of repercussions based upon information gained from inspection of their personal medical records may deter patients from participating in the medical cannabis program.” — Green in the veto message
The message did not outline any opposition to other provisions in the bill but noted that Green’s administration “remains committed to Hawai‘i’s existing medical cannabis program and supports efforts to expand access to medical cannabis for any medical condition.”
In April, Hawaii House lawmakers took aim at shops selling intoxicating hemp-derived products. In a resolution, the chamber said that there are more than 84 “illegal dispensary operators” in the state and that the number is increasing “exponentially.” The bill vetoed by Green focused on illegally operating medical cannabis dispensaries, but did not address shops selling intoxicating hemp products.
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Florida Lawmakers Advance Bill To Revoke Medical Marijuana Cards From People Convicted Of Cannabis And Other Drug Crimes

Published
3 hours agoon
June 12, 2025
A legislative proposal now before a Florida conference committee threatens to revoke medical marijuana registrations for people convicted of certain drug crimes—including simply purchasing more than 10 grams of cannabis.
The provision, which would affect both registered patients and caregivers, was agreed to on Tuesday by House lawmakers. It was a part of SB 2514 when the legislation was filed and later passed by the Senate, while the House approved an entirely different version of the bill and sent the disagreement to be ironed out in the conference committee, formed earlier this month.
As first reported by Florida Politics, House lawmakers have now signed off on the Senate medical marijuana language, offering to accept that provision. Though the offer hasn’t been finalized, it’s reportedly “very likely” the restriction will be included.
The Senate language would require the state Department of Health (DOH) “to revoke the registration” of a qualified patient or caregiver if that person “entered a plea of guilty or nolo contendere or was found guilty” of a covered drug offense.
Patients’ or caregivers’ registrations would be suspended immediately upon charges being filed, and the suspensions would last until “final disposition of the alleged offense.”
It’s not clear from the plain language of the proposal whether it would impact only future criminal cases involving medical marijuana patients and caregivers or whether DOH would need to review the records of existing program registrants and revoke registrations of an untold number of Floridians with past drug convictions.
Florida Politics wrote of the bill that “for those who found the medical marijuana program as a way to escape the black market, the new language may complicate their legal status.”
The provision would impact people charged under the state Drug Abuse Prevention and Control Act and reportedly covers cases involving the purchase of more than 10 grams” of any illicit substance or the delivery “without consideration, [of] 20 grams or less of cannabis.”
Lawmakers defeated several proposals to expand the medical cannabis program during this year’s regular legislation session—including by allowing home cultivation, adding new qualifying conditions, protecting employment and parental rights of patients and letting military veterans register for free.
Meanwhile in Florida, advocates are working toward putting a new adult-use marijuana legalization measure on the 2026 state ballot following the failure of Amendment 3 at the polls last November.
After filing the measure and launching a signature drive earlier this year, the campaign Smart & Safe Florida has collected 377,832 valid signatures—about 150,000 more than required to kick off the review process, according to Division of Elections numbers from earlier this month.
The state is now statutorily obligated to conduct a judicial and financial review of the measure that will determine its legal eligibility and inform the electorate about its potential economic impact.
Smart & Safe Florida is hoping the revised version will succeed in 2026. The campaign—which in the last election cycle received tens of millions of dollars from cannabis industry stakeholders, principally the multi-state operator Trulieve—incorporated certain changes into the new version that seem responsive to criticism opponents raised during the 2024 push.
For example, it now specifically states that the “smoking and vaping of marijuana in any public place is prohibited.”Another section asserts that the legislature would need to approve rules dealing with the “regulation of the time, place, and manner of the public consumption of marijuana.”
Gov. Ron DeSantis (R) had repeatedly condemned the 2024 initiative over that issue, claiming there were not parameters to prevent public smoking, while expressing his distaste for the smell of cannabis.
The governor said in February that the newest measure is in “big time trouble” with the state Supreme Court, predicting it will be blocked from going before voters next year.
Last year, the governor accurately predicted that the 2024 cannabis measure from the campaign would survive a legal challenge from the state attorney general. It’s not entirely clear why he feels this version would face a different outcome.
While there’s uncertainty around how the state’s highest court will navigate the measure, a poll released in February showed overwhelming bipartisan voter support for the reform—with 67 percent of Florida voters backing legalization, including 82 percent of Democrats, 66 percent of independents and 55 percent of Republicans.
However, the results conflict with another recent poll from the Florida Chamber of Commerce, a proactive opponent of legalization, that found majority support for the reform among likely voter (53 percent) but not enough to be enacted under the 60 percent requirement.
In the background of the campaign’s signature development, DeSantis signed a GOP-led bill last month to impose significant restrictions on the ability to put initiatives on the ballot—a plan that could impair efforts to let voters decide on marijuana legalization next year.
Separately, a Florida GOP senator claimed recently that the legalization campaign “tricked” Trump into supporting the 2024 measure by misleading him and the general public about key provisions.
Ahead of the election, Trump said in September that he felt Amendment 3 was “going to be very good” for the state.
Before making the comments, Trump met with the CEO of Trulieve, Kim Rivers, as well as with a GOP state senator who is in favor of the reform.
While Trump endorsed the Florida cannabis initiative—as well as federal rescheduling and industry banking access—he has since been silent on cannabis issues. And his cabinet choices have mixed records on marijuana policy.
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