Although the US is considered a global leader in many significant areas, Canada now holds first place as the world's largest market for legalized marijuana. As the second country to legalize recreational marijuana, Canada's government now benefits from the certification process and a modest ten percent sales tax on cannabis products. The national legalization is considered a "national experiment" that many believe will alter the economic fabric of a progressive country.
This bold move is not without controversy. The government has left the implementation of the new regulatory standards to the jurisdiction of individual provinces. With 10 US states legalizing recreational marijuana and 33 states approving medical use, a significant number of Americans wonder how Canada managed to legalize recreational marijuana before we did.
The Legalization of Marijuana in Canada
Canada's legalization of marijuana in the fall of 2018, is generating a significant amount of revenue for the government and each province. Under the new legislation, the government retains 25 percent of the proceeds generated by a modest sales tax, any additional revenue is divided between the 13 provinces and territories.
Many of the regulatory decisions, including the ability to ban marijuana use, are left to the discretion of the provinces. The ten provinces and three territories have the right to regulate where residents are allowed to purchase products and where those products can be used. The government regulates how much consumers can be charged to minimize the appeal of black-market pricing. Marijuana users must adhere to the following terms:
- Purchasing Restrictions – the provinces decide if residents must purchase from government stores, private organizations, or a combination of the two. Those selling must be licensed by the government
- Age restrictions - the legal age to use marijuana is 19 in most areas, 18 in two provinces, and may be raised to 21 in Quebec
- Possession Restrictions- adults are allowed to possess, carry, and share up to 30 grams of dried cannabis
- Growing Restrictions- in most provinces up to four homegrown plants are permitted in homes without children
- Stricter Penalties – those convicted of providing marijuana to minors now face penalties of up to 14 years in prison
- Regulated THC Levels - legal marijuana has lower levels of THC, the cannabinoid that causes intoxication, than many unregulated supplies
- Sales Restrictions - no bars or restaurants will be selling cannabis at this time
In provinces where recreational use is banned, Canadians can still order marijuana from government websites. This provision was intended to eliminate the need for those living in areas banning marijuana use to purchase from illegal sources. Now that the government will profit from the cannabis industry, law enforcement agencies will have additional incentive to shut down illegal dispensaries.
The Canadian Legislative Timeline
The legalization of marijuana in Canada has been in the works since the election of Prime Minister Justin Trudeau in 2015. The rationale for supporting marijuana legalization included taming the illegal multi-billion-dollar industry, keeping marijuana from underage users, and curtailing the cost of prosecuting marijuana-related crimes.
While Canada's legalization of marijuana appears to have escalated quickly, it's interesting to look back at the progression from prohibition to legalization. It's quite possible the US could learn from Canada's example. Consider the following highlights of Canada's journey:
The Early Years of Canadian ProhibitionThe criminalization of intoxicating substances in Canada began with the 1908 Opium Act. This early legislation banned the use of opium, morphine, and cocaine for recreational use. In the 1920s, cannabis was added to the list of restricted substances under the Narcotics Drug Act amendment bill. Canada's restrictions on marijuana came more than ten years ahead of similar legislation in the US.
Introducing Tougher LawsWhile cannabis was added to the list of controlled substances in the 1920s, recreational marijuana was almost unheard of in Canada until the 1930s. Marijuana use did not surge in popularity until the 1960s. By then, the maximum penalty for possession was six months in prison and a 1000 dollar fine. That changed with the Narcotic Control Act of 1961 when penalties were increased to a maximum sentence of 14 years.
Reviewing Non-Medical UsesCanada responded to the increased popularity of marijuana and the mounting charges against middle-class citizens by establishing the Royal Commission of Inquiry in the Non-Medical Use of Drugs (the Le Dain Commission) in 1969. As a result of their findings, the commissions 1972 report recommended removing criminal penalties for marijuana use. While the topic was discussed by two subsequent governments, there were no changes made to existing legislation.
Approving Medical MarijuanaIn 2000, Canadian courts ruled that citizens have the right to medical cannabis. In July of 2001, the regulations for access to medical marijuana were established by Health Canada. The Medical Marijuana Access Program (MMAP), allowed any physician comfortable prescribing medications for approved medical conditions the ability to legally do so. Patients could purchase through approved suppliers or grow their own after completing a series of applications.
The First Round of Decriminalization EffortsIn 2003 a bill was introduced to decriminalize the possession of small amounts of marijuana for personal use when the government was under the leadership of Prime Minister Jean Chretién. Although the bill seemed likely to pass into law the legislation died between elections. Some believe the death of the legislation was largely due to the US governments threat to slow crossing along the Canada - US border. The effort was revisited in 2004 under Prime Minister Paul Martin, but blocked by conservatives during the 2006 election.
Government Regulation of Medical MarijuanaIn 2014, the Medical Marijuana Access Program was replaced by the Marijuana for Medical Purposes by Health Canada. Under the MMPR, medical cannabis production is authorized by Health Canada. Patients needing to fill a prescription must register and order from a nationally licensed provider.
The Path to Legalization BeginsIn 2013 Justin Trudeau campaigned for leadership of Canada's Liberal Party. Trudeau saw that marijuana prohibition was not working and campaigned in favor of legalization. Using Colorado and Washington State as examples, Trudeau urged lawmakers to regulate cultivation, tax marijuana sales, and keep illegal marijuana out of the hands of children by increasing the penalty for selling marijuana to minors.
Parliament Explores Legalization OptionsWhen Trudeau became Prime Minister in 2015, Parliament created a committee to explore legalization issues. Known as the Task Force on Cannabis Legalization and Regulation, this committee compared the options of legalizing by province or nationwide. National legalization was determined to be the best option.
Canada Becomes the Second Country to Legalize CannabisUruguay was the first country to legalize marijuana in 2013. In April of 2017, the Cannabis Act was introduced to Parliament. The Cannabis Act would legalize possession of up to an ounce of marijuana for those over 18 with each of the 10 provinces and three territories. Each province and territory would be responsible for determining how marijuana could be purchased and where it could be used. The legislation passed in June 2018 with a vote of 52 to 29. Legalization took effect on October 17th of the same year.
Canada is Upstaging the US on Cannabis Legalization
While individual members of Congress have suggested national legalization of marijuana, legislation has not experienced the same momentum generated in Canada. Last year, New Jersey Senator Cory Booker (D) introduced legislation to end federal prohibition. Although the legislation has stalled in the Senate, there has been forward momentum at state levels.
Canada legalized marijuana in order to regulate product quality, curtail illegal purchases, and reduce the availability of marijuana to minors. The modest tax on legal products benefits the national government, but 75 percent of the funds raised through taxation is divided between the provinces and territories.
In 2017, Canadians were estimated to have spent 4.4 billion CAD on cannabis, with only 570 million CAD spent on legal, medical marijuana. As more Canadians move to legal purchases, marijuana is predicted to grow to a 5.5 billion dollar industry by 2022. As Canada takes a progressive approach to marijuana use, the US (and the rest of the world) will continue to assess Canada's bold legislative decisions.