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How Legalizing Cannabis in Canada Will Impact the Economy

July 2, 2018
How Legalizing Cannabis in Canada Will Impact the Economy

The approval of Senate Bill C-45 makes Canada the first member country of G7 to legalize recreational cannabis. This may serve as a model for other neighboring countries who are thinking about taking the same step. Legalizing recreational cannabis will impact Canada's already booming economy is more than one ways. The economic benefits that come with legalizing recreational cannabis in Canada will most probably serve as a model for other economies to follow suit. Let us have a look at 4 high economic benefits Canada will enjoy by legalizing recreational cannabis:

  1.     Creation of more Job Opportunities

The Canadian cannabis industry will surely generate more jobs for its citizens and this can go a long way in reducing unemployment rates in the country. Once the Canadians will start growing cannabis in the country as per the guidelines of the government, many allied industries such as grow rooms, air filtration systems, odor control systems, and appropriate licenses will also boom and this, in turn, will create more job opportunities for the citizens of Canada. Experts estimate that there are more than 150,000 vacancies that currently need to be filled to facilitate cannabis trade in the country. Majority of these jobs will be available in the sectors of growing cannabis, selling cannabis, packaging cannabis products and for education and health promotion.

  1.     Increase In GDP

Experts also predict that legalization of recreational cannabis in Canada will result in further expansion of the market. According to some estimates, it will contribute to as much as $6 billion increase in Canada's GDP once it is fully operational. It will also result in an increase in government revenues in the shape of taxes (such as municipality taxes, business taxes, property taxes) and fees such as license fees and this will ultimately impact Canada's GDP substantially. It is quite clear from the example of some US states such as California and Colorado where cannabis is now legal. Canada is expected to collect an overwhelming amount of tax and sales revenues from this move.

  1.     Reduction in Court and Police Expenses

Legalizing recreational cannabis in Canada will also help free up some financial resources that are tied up to the policing and law department in enforcing the law and arresting people for cannabis-related offenses. This will even help free up some manpower from both the departments that can be used for other important matter that cause fear amongst citizens such as child abuse, burglary, sexual assault, domestic violence, and other rather than using the manpower for going after cannabis-related culprits.

The courts will also be able to register considerable savings as a result of the legalization of recreational cannabis in Canada since there will not need to register cannabis-related cases and there will be more savings from having no such trials. It will also free up the time of the court, which can be used for some other important matter.

  1.     Prices will Comedown

The legalization of recreational cannabis in Canada will also help bring the prices of cannabis down since there will be no need to rely on the black market. Once the government-run stores and dispensaries start selling cannabis legally to the consumers, the prices may at first go high as a result of high demand and short supply, but with the passage of time and more producers, manufacturers, and sellers enter the market, it will eventually come down.

It is for sure that legalization of recreational cannabis will contribute significantly to Canada's economy but the benefits may not be noticed immediately. It is going to be a slow process, some experts suggest, but it will surely bring a positive impact to improve Canada's economic condition in the long run.

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