CBSA Message: TCC19-145 - Cannabis - Edibles, Extracts and Topicals Customs Excise Duty Procedures / Procédures relatives aux droits d'accise sur le cannabis comestible, extraits de cannabis et cannabis pour usage topique

Further to Customs Notice CN19-24 pertaining to Cannabis - Edibles, Extracts and Topicals Customs Excise Duty Procedures https://www.cbsa-asfc.gc.ca/publications/cn-ad/cn19-24-eng.html please note the following for completion of the CADEX formatted records:

3. The table below is a list of the province/territory HS Administrative Codes to be entered in Field 27 on Form B3-3, Canada Customs Coding Form.

4. The table below is a list of the Proposed Excise Duty Rates for Cannabis Edibles, Cannabis Extracts (including Oil) and Cannabis Topicals

5. The following example illustrates how the customs duty, federal excise duty and provincial excise duty is to be calculated on Form B3-3, Canada Customs Coding Form.

Example:

Calculation of cannabis duty and additional cannabis duty on a chocolate bar (U.S. origin), 100 grams, infused with 500 milligrams of THC imported in Ontario. The value of the importation is $200.00 (CAD).

Classification - Line 1
Shows the actual classification line; the Health Canada Import permit number must be entered in Special Authority field (26). The GST (5%) is calculated on the value for duty and entered in Field 42.

Calculation of Combined Federal and Provincial Excise Duty - Line 2
Shows the amount of the combined federal and provincial excise duty; this amount is calculated at $0.01 per milligram of THC of the quantity imported (which includes the flat-rate federal cannabis duty of $0.0025 per milligram of the total THC of the cannabis product plus the flat-rate provincial additional cannabis duty of $0.0075). See Table - Proposed Excise Duty Rates for Cannabis Edibles, Cannabis Extracts (including Oil) and Cannabis Topicals

• The importer is required to add the province/territory HS Administrative Code, for the province/territory of import in Field 27. See Table - List of the province/territory HS Administrative Codes
• The importer is required to enter 44 on field 34 – Excise Tax Rate to allow a manual calculation of Federal and Provincial excise duty to be entered in field 40 and THC quantity must be entered in field 29 of this line.
• The amount of the excise duty payable to be entered in field 40 is $5.00, this is calculated by multiplying 500 milligrams of THC by $0.01.
• This amount of $5.00 is also to be entered in field 41, value for tax.

Provincial Sales Tax Adjustment - Line 3
Shows the amount of sales tax adjustment for Ontario, calculated by multiplying the base amount by 3.9%. See Table - Proposed Excise Duty Rates for Cannabis Edibles, Cannabis Extracts (including Oil) and Cannabis Topicals

• The importer is required to add the province/territory HS Administrative Code, for the province/territory of import in Field 27. See Table - List of the province/territory HS Administrative Codes
• The importer is required to enter 44 on field 34 – Excise Tax Rate and manually calculate the sales tax adjustment amount to be entered on field 40.
• The sales tax adjustment amount to be entered in on field 40 is $7.80.  This amount is calculated by multiplying the value for duty from field 37 of Line 1 ($200.00) by the provincial sales tax adjustment rate for the province of Ontario, which is 3.9%
• This amount of $7.80 is also to be entered in field 41, value for tax.

CADEX FORMAT

Line 1

• Prepare the first B3 line as you normally would to account for the goods
• The KI30 record would contain the Health Canada Import permit number in the Special Authority field
• The KI50 record would contain 00000001000 in the GST Amount field

Line 2

• The KI30 record would contain 0000999978 in the Classification Number field
• The KI40 record would contain 0000000500000 in the Classification Line Quantity field
• The KI50 record would contain 44.0 in the Excise Tax Rate field
• The KI50 record would contain 0000000500 in the Excise Tax Amount field
• The KI50 record would contain 000000000500 in the Value for Tax field

Line 3

• The KI30 record would contain 0000999978 in the Classification Number field

• The KI50 record would contain 44.0 in the Excise Tax Rate field
• The KI50 record would contain 0000000780 in the Excise Tax Amount field
• The KI50 record would contain 000000000780 in the Value for Tax field

• The KI90 record would contain 00000001280 in the Total Excise Tax field
• The KI90 record would contain 000000001064 in the Total GST field
• The KI90 record would contain 000000002344 in the Total Duty & Tax field