Cannabis retail fees slashed across BC

Published on January 13, 2022 by David Wylie

Municipalities across BC are slashing hefty licensing fees charged to cannabis retailers.

This week, Vernon city council unanimously approved a staff recommendation to cut the cost of the retail cannabis application fee by half, from $5,000 to $2,500. The city will also reduce its annual licensing fee to an amount determined by each cannabis store’s square footage, somewhere between $115 and $800 a year, depending on the size. It’s the same fee model applied to liquor stores in the city.

“Excessive fees only hurt the entrepreneurial spirit and slow economic recovery,” says Greater Vernon Chamber of Commerce president Robin Cardew.

“Our chamber urged the City of Vernon last spring to reconsider business license fees for retail cannabis, and we kept the matter top of mind as the process took several months.”

Last year, Vancouver reduced its application fee from $34,000 down to $13,500. (It’s still the highest fee in BC, though the city is considering dropping the fee to $5,000 in 2023.) Pemberton adopted a phased approach to cut fees from $5,000 to $150 by 2023. Dawson Creek has reduced fees from $2,500 to $625 align with the licence fee for liquor stores. Chilliwack plans to decrease its fee this year, from $10,000 to $2,500.

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And the list of cities reducing the fee continues to grow.

The City of Kelowna currently charges about $9,500, the highest annual licence fee in the Okanagan for cannabis stores. However, that’s likely to change in the coming months.

Ryan Smith, divisional director of planning and development services at the City of Kelowna, told the oz. that city staff will recommend council approve a reduction later this year. He says fees are likely come into line with those paid by liquor stores.

“The fees were high because we needed to pay for the staff time to implement the new cannabis program here, but also we were recovering costs of bylaw and RCMP training for field sobriety testing and that type of thing,” he says. “The province had actually promised that they were going to pass some of that money back to local governments and we’ve never seen any of that.”

Smith says the process to reduce fees has taken time because the city is in the midst of overhauling its zoning bylaws, and  cannabis store fees need to be consistent.

Meanwhile on Vancouver Island, Victoria is considering cutting its annual licensing fees from $5,000 to $280, according to a report presented to a council committee on Thursday (Jan. 13).

“Like Victoria, many municipalities adopted special licensing and operating conditions for cannabis retail stores which is reflected in higher business licensing fees,” says the report.

“This change would create level playing field with liquor retail stores.”