OTTAWA — The federal government has agreed to give the provinces and territories a 75 per cent share of the tax revenues from the sale of legalized marijuana.
Finance Minister Bill Morneau announced the agreement today after a day-long meeting with his provincial and territorial counterparts.
The original model put forward by the federal government proposed an even 50-50 split, a plan that was immediately shot down by the provinces, many of which wondered aloud what sort of costs Ottawa would be incurring to deserve such a share.
Earlier today, Ontario Finance Minister Charles Sousa said the federal Liberal government had successfully made the case that it, too, would have costs, but was showing flexibility on related revenue and cost-sharing questions.
WATCH: Bill Morneau, finance ministers discuss revenue sharing with impending marijuana legalization
After a meeting with his Atlantic counterparts in Halifax, Nova Scotia Premier Stephen McNeil let slip that a two-year deal had been reached, and that provinces would have the ability to include a markup above and beyond existing taxation levels.
Ottawa’s initial estimates suggest the total pot of tax revenue from marijuana sales could reach $1 billion per year athough, on Monday, Morneau said he expects the excise tax to pull in about $400 million in each of the first two years that pot is legal.