A Canadian flag with a cannabis leaf flies on Parliament Hill during the 4/20 protest, Monday, April 20, 2015 in Ottawa. (THE CANADIAN PRESS/Adrian Wyld)

Un-Canadian, inappropriate, simply wrong, and insulting. When it comes to the taxation of medical cannabis, Canada’s pot producers and patient advocates are not mincing words.

“A patient can get a prescription for an opioid that has no tax applied, then is reimbursed by provincial drug plans and private insurers. At the same time, cannabis, a substance that for many patients can be an alternative, is discriminated against,” Aurora Cannabis Inc. Chief Corporate Officer Cam Battley (ACB.TO) told Yahoo Finance Canada in an interview. “This simply strikes us as outrageous.”

“The reality is, governments don’t like to give up on taxes,” Canopy Growth Corp. (WEED.TO) co-CEO Bruce Linton told Yahoo Finance Canada at a recent event in Toronto. “For medical cannabis, it’s inappropriate.”

Last fall, Canada sparked global excitement when it became the first G7 nation to legalize the drug for recreational use. For those reliant on doctor-prescribed cannabis to treat medical conditions, the landmark legislation made it instantly harder to afford.

In Canada, there are no taxes on prescription medications. Cannabis is the exception. The government has collected taxes since July 2001, when the Marihuana Medical Access Regulations enabled individuals authorized by their health care practitioner to access the drug.

The Cannabis Act absorbed the previous medical legislation on Oct. 17 of last year. Under that framework, the government charges an additional $1-per-gram or 10 per cent of the cost on both medical and recreational cannabis, whichever is higher. That’s on top of sales taxes.

“It’s actually a tax upon a tax. How does that make any kind of sense at all?” said Battley. “The cost to the government of dropping the taxes would be miniscule. But the impact on actual patients dealing with serious illnesses is significant.”

Edmonton-based Aurora recently took its opposition to the streets with a bold public awareness campaign to shame the government into dropping all taxes on medical cannabis.

On a grey February afternoon, Battley tweeted a photo of cube van strategically parked in front of Finance Minister Bill Morneau’s Toronto constituency office. On its sides, large screens display a digital ticker showing the rising tally of tax dollars paid by Canadian medical cannabis patients since 2014. On that day, Feb. 19, it read $121,550,915.

Do you think ⁦@Bill_Morneau⁩ will consider this, or dismiss it? Who needs the money more? The federal government, or patients with chronic illnesses trying to get by? Do the right thing, Mr. Morneau. Let’s all get together on this. #DontTaxMedicine pic.twitter.com/FGJr9SyA1p — Cam Battley (@CamBattley) February 20, 2019

The ticker also lives on an Aurora-sponsored website called CannabisTaxTicker.com.

Canopy is equally determined to see Ottawa scrap the taxes. However, the Smiths Falls, Ont.-based company sees a different path to putting tax-free cannabis in the hands of patients.

“All the lobbying in the world isn’t going to win, where science could,” Linton said. “That’s what we’re doing.”



He expects Canopy will have enough evidence this year to begin making scientific claims about certain products, paving the way for better integration into the medical system.

“We’re running sleep trials now. We’re trying to show that a combination of cannabinoids works better than say benzodiazepine-based sleep aids, which do not attract taxation if they are given under prescription,” he said.

“Once we do studies, and we can actually call it a medical product because it can actually have a drug identification number (DIN), I think then it is going to be much easier to say this is not going to be taxed.”

Canopy’s newest executive has more than 20 years experience serving medical patients. Initially, outside the bounds of the law. Needless to say, Chief Advocacy Officer Hilary Black is no stranger to grassroots activism. For now though, she and Canopy are staying focused on fast-tracking its scientific trials to secure DINs.

“What I have been told quietly is that the taxation isn’t going to change until we have products that have gone through the drug approval process and have DIN numbers,” she told Yahoo Finance Canada. “That’s the message that I have been getting from inside the government.”

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