MOUNTAIN VIEW COUNTY - Mountain View County expects to realize a substantial increase in tax revenue due to recently announced changes in the taxation rules for cannabis production facilities, says director of corporate services Rob Beaupertuis.
“Based on the 2018 assessment data that we have at this point, the municipal portion of the taxes will go from $8,000 to $98,000, he said.
The changes will move production facilities from the farm rate of $300 per acre to market rate, he added.
Alberta rural municipalities are pleased with the changes to the taxation rules, which were announced last week, says Al Kemmere, Mountain View County councillor and the president of the Rural Municipalities of Alberta Association (RMA).
Under the changes being made to Alberta’s property tax rules and coming into effect in the 2020 tax year, cannabis facilities will be taxed as non-agricultural businesses.
Up until now those facilities have been taxed as farm operations, typically at a lower rate than non-farm operations.
The RMA, which represents 69 rural municipalities including Mountain View and Red Deer counties, has been calling for the tax change for several months.
“The RMA welcomes this announcement, as we’ve been asking the government to put cannabis-production facilities on equal footing with other industrial businesses since legalization,” said Kemmere. “I’m glad the government listened to our concerns and acted swiftly.”
Aurora Cannabis operates facilities across Canada, including one just outside Cremona. Company spokesperson Laura Gallant provided the following statement:
“While this news is disappointing, Aurora remains committed to our roots in our home province of Alberta. Our founders are proud Albertans, and are proud to bring continued value to the province through creation of more than 2,000 jobs to date and investment of over $500 million.
“We will continue to work closely with our provincial and municipal partners, and see a bright future for communities across the province as we continue to build the global cannabis industry from right here at home.”
Mountain View County reeve Bruce Beattie said he is pleased with the changes.
“I think it’s an appropriate way to proceed,” said Beattie. “We’ve seen with the shallow gas industry where they were concerned about tax levels, so I’m hoping this won’t have too much of a negative impact on our cannabis facilities. It is a new industry and it is just developing.”
Municipal Affairs Minister Kaycee Madu announced the changes at the RMA’s annual convention in Edmonton on Nov. 13.
“This change responds directly to the concerns of municipalities, who asked for this distinction in provincial tax regulations,” said Madu. “While cannabis is a burgeoning industry, it is important that cannabis-production facilities, which are heavy users of municipal services, pay their share for those services.”
Under the changes announced last week the definition of farming in the tax regulations has been changed to clarify it does not include commercial cannabis production, he said.
