Organigram Applauds the Standing Committee on Finance’s Recommendation on Excise Duty
29 February 2024 - 12:00AM
Business Wire
Revised Excise Framework Remains One of the
Most Critical Reforms Required to Ensure the Long-Term Viability of
the Cannabis Industry
Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI), (the
“Company” or “Organigram”) enthusiastically supports the Standing
Committee on Finance’s recent recommendation on the Excise Duty
framework.
In a recently released report, titled ‘Shaping our Economic
Future: Canadian Priorities,’ the House of Commons Standing
Committee on Finance has unanimously recommended adjusting the
excise duty formula for cannabis so that it is limited to a 10% ad
valorem rate, and modifying the duty's operation, including
applying excise stamps on cannabis products.
Based on a survey conducted by the Cannabis Council of Canada,
licensed producers currently pay up to 35% of top-line revenue in
excise duties because of an erroneous assumption at the time of
legalization that the price of cannabis flower would be
approximately $10 per gram to the retail consumer. In reality, the
price per gram of cannabis flower has fallen to as low as
approximately $3 per gram, limiting cannabis companies’ ability to
remain competitive on pricing, invest in innovation, retain jobs,
and ultimately support the government’s stated objectives of
illicit market conversion and promoting public health and
safety.
“The pre-budget recommendation could not have come at a better
time,” said Beena Goldenberg, CEO of Organigram. “Excise reform is
critical to the long-term viability of the Canadian cannabis
industry. The positive impact of the proposed reduction to a 10% ad
valorem rate on the sustainability of the sector cannot be
underestimated. We sincerely hope that the recommendation made by
the Finance Committee is adopted by the Federal, Provincial and
Territorial governments so that Canada can retain its position as
global leader in the emerging cannabis movement.”
“We are also encouraged by recent reports indicating that the
CRA is taking proactive measures to level the playing field by
collecting more diligently from LPs who have fallen behind on their
remittances for excise duties,” added Beena.
About Organigram Holdings Inc.
Organigram Holdings Inc. is a NASDAQ Global Select Market and
TSX listed company whose wholly owned subsidiaries include
Organigram Inc. a licensed producer of cannabis, cannabis-derived
products and cannabis infused edibles in Canada.
Organigram is focused on producing high-quality, cannabis for
patients and adult recreational consumers, as well as developing
international business partnerships to extend the Company’s global
footprint. Organigram has also developed and acquired a portfolio
of legal adult-use recreational cannabis brands, including Edison,
Holy Mountain, Big Bag O’ Buds, SHRED, SHRED’ems, Monjour,
Laurentian, Tremblant Cannabis and Trailblazer. Organigram operates
facilities in Moncton, New Brunswick and Lac-Supérieur, Quebec,
with a dedicated edibles manufacturing facility in Winnipeg,
Manitoba. The Company is regulated by the Cannabis Act and the
Cannabis Regulations (Canada).
Forward-Looking Information
This news release contains forward-looking information. Often,
but not always, forward-looking information can be identified by
the use of words such as “plans”, “expects”, “estimates”,
“intends”, “anticipates”, “believes” or variations of such words
and phrases or state that certain actions, events, or results
“may”, “could”, “would”, “might” or “will” be taken, occur or be
achieved. Forward-looking information involves known and unknown
risks, uncertainties and other factors that may cause actual
results, events, performance or achievements of Organigram to
differ materially from current expectations or future results,
performance or achievements expressed or implied by the
forward-looking information contained in this news release. Risks,
uncertainties and other factors involved with forward-looking
information could cause actual events, results, performance,
prospects and opportunities to differ materially from those
expressed or implied by such forward-looking information include
adoption of budget recommendations and timing thereof, changes to
market conditions, consumer preferences and regulatory climate and
factors and risks as disclosed in the Company’s most recent annual
information form, management’s discussion and analysis and other
Company documents filed from time to time on SEDAR (see
www.sedar.com) and filed or furnished to the Securities and
Exchange Commission on EDGAR (see www.sec.gov). Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this press release.
Although the Company believes that the assumptions and factors used
in preparing the forward-looking information in this news release
are reasonable, undue reliance should not be placed on such
information and no assurance can be given that such events will
occur in the disclosed time frames or at all. The forward-looking
information included in this news release are made as of the date
of this news release and the Company disclaims any intention or
obligation, except to the extent required by law, to update or
revise any forward-looking information, whether as a result of new
information, future events or otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20240228644763/en/
For Media enquiries:
Megan McCrae Senior Vice President, Global Brands and Corporate
Affairs megan.mccrae@organigram.ca Organigram
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