Sale of Medical Marihuana
In general, the GST and QST apply to the sale of drugs (including substances considered as drugs) produced for human consumption. However, such substances are zero rated for tax purposes (that is, they are taxed at a rate of 0%), if they meet any of the following criteria:
- the substance is controlled by the federal government under the Food and Drugs Act, the Food and Drug Regulations or the Narcotic Control Regulations;
- the substance is provided to an individual by a doctor or sold by prescription;
- the use of the substance in emergency treatments is authorized under the Food and Drug Regulations.
The use of medical marihuana is regulated by the Controlled Drugs and Substances Act. According to the Marihuana Medical Access Regulations, holders of an authorization to posses dried marihuana can purchase such marihuana for medical purposes without a prescription. Consequently, since the dried marihuana acquired in compliance with the Regulations is acquired without a prescription, the supply of such marihuana is subject to the GST and QST.