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Commercial cannabis producers in Alberta to start paying property taxes

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WATCH ABOVE: Cannabis-production facilities in Alberta will soon be paying higher taxes. As Tom Vernon reports, the province is removing a key exemption to help municipalities make some money.

Municipalities in Alberta are to get a new source of revenue next year when commercial cannabis producers start paying property taxes.

Municipal Affairs Minister Kaycee Madu says cannabis growers will no longer be classified as agricultural businesses and so won’t qualify for a tax exemption.

READ MORE: Alberta Government collects $30M from cannabis tax since legalization

The change is to come into effect in the 2020 tax year.

Madu made the announcement at the Rural Municipalities of Alberta fall convention in Edmonton.

Municipal assessors will be responsible for market-value assessments and the government isn’t saying how much additional revenue is expected.

READ MORE: Alberta sees most money spent on cannabis since legalization: StatCan

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The tax change does not apply to greenhouse operations or industrial hemp cultivation.

Madu said Alberta’s current tax regulations don’t adequately address cannabis production, which doesn’t really fall under the traditional definition of agriculture.

“Cannabis production facilities are large industrial operations and like any other local businesses, they need to pay for municipal services that they use,” Madu told the convention.

“Beginning next year, you will be able to collect taxes on these properties.”

Rural municipalities president Al Kemmere said the group welcomes the announcement.

“We’ve been asking the government to put cannabis-production facilities on equal footing with other industrial businesses since legalization. I’m glad the government listened to our concerns and acted swiftly.”