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Ottawa agrees to give provinces 75% of marijuana tax revenue

Click to play video: 'Feds agree to give provinces 75 per cent of pot tax revenues' Feds agree to give provinces 75 per cent of pot tax revenues
WATCH ABOVE: Ottawa agreed to give the provinces 75 per cent of tax revenues when marijuana is legalized next month – Dec 11, 2017

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.

READ MORE: Atlantic premiers concerned about marijuana supply, push Ottawa to expedite licensing

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.

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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

Click to play video: 'Bill Morneau, finance ministers discuss revenue sharing with impending marijuana legalization' Bill Morneau, finance ministers discuss revenue sharing with impending marijuana legalization
Bill Morneau, finance ministers discuss revenue sharing with impending marijuana legalization – Dec 11, 2017

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.

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