Please note that the following document, although correct at the time of issue, may not represent the current position of the Canada Revenue Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence du revenu du Canada.
Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 11th floor
320 Queen Street
Ottawa ON K1A 0L5
[Client Address]
Case Number: 243746
Dear[Client]:
Subject: Interpretation: Whether Bubble Hash qualifies as a “Low-THC Cannabis Product”
Thank you for your correspondence of [mm/dd/yyyy], concerning the application of the Excise Act, 2001 (the “Act”) to [Client’s] bubble hash.
You have requested a clarification on:
1. Whether this product meets the definition of “low-THC cannabis product” under the Excise Act, 2001.
2. Whether, if sold after further processing such as heated pressing to melt the material into a solid bar or further filtered and pressed rosin, whether the product would meet the definition of “low-THC cannabis product” under the Act.
3. If it does qualify as a “low-THC cannabis product”, whether anything that is not dried or fresh cannabis or cannabis oil can be added to the material and have it still retain status as a “low-THC cannabis product”.
1. The issue is whether [Client’s] bubble hash qualifies as a low-THC cannabis product.
Section 2 of the Excise Act, 2001 defines “low-THC cannabis product” as follows:
low-THC cannabis product?means a cannabis product
* (a) consisting entirely of
o (i) fresh cannabis,
o (ii) dried cannabis, or
o (iii) oil that contains anything referred to in item 1 or 3 of Schedule 1 to the Cannabis Act and that is in liquid form at a temperature of 22 ± 2°C; and
* (b) any part of which does not have a maximum yield of more than 0.3% THC w/w, taking into account the potential to convert THCA into THC, as determined in accordance with the Cannabis Act.
You state in your correspondence that the bubble hash “is the solventlessly extracted trichomes from dried cannabis”.
In this instance, the product, known as “Bubble hash” consists entirely of dried cannabis and contains less than 0.3% THC weight by weight. It therefore meets the definition of “low-THC cannabis product”.
2. The issue is whether, if sold after further processing such as heated pressing to melt the material into a solid bar or further filtered and pressed rosin, whether the product would meet the definition of “low-THC cannabis product” under the Act.
Once again, in order to be considered a “low-THC cannabis product”, the product is must consist entirely of dried or fresh cannabis, or must qualify as cannabis oil in order to meet the definition of “low-THC cannabis product”.
Because the solid bar or filtered and pressed rosin consists of the solventlessly extracted trichomes from dried cannabis, it would be deemed to consist entirely of dried cannabis, and would therefore meet the definition of “low-THC cannabis product”.
3. The issue is if it does qualify as a “low-THC cannabis product”, whether anything that is not dried or fresh cannabis or cannabis oil can be added to the material and have it still retain status as a “low-THC cannabis product”.
In order to meet the definition of “low-THC cannabis product”, a cannabis product would have to consist entirely of dried or fresh cannabis, or meet the definition of cannabis oil, which would also have to consist entirely of dried or fresh cannabis in addition to a carrier oil.
If any other ingredient were to be added to the product, it would therefore cease to meet the definition of “low-THC cannabis product”.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at (343) 571-7853.
Yours truly,
Neil Varan
Neil Varan
Excise Duty Operations - Cannabis
Excise Duties and Taxes Division
Excise and GST/HST Rulings Directorate
PROTECTED B
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