The wins and the work left to do in Canada, four years after legalization

4 mins read

Today marks the fourth anniversary since Canada legalized adult-use cannabis.

The second country in the world to federally legalize the drug for recreational use, following Uruguay, Canada has in many ways been the poster child for the legal cannabis industry, but it hasn’t been without its teething problems.

Only last month, almost four years on, has a review been started on the legislation of the Cannabis Act. The Minister of Health said in a statement that the ‘evidence-driven’ review will “strengthen the Act, so that it meets the needs of all Canadians, while continuing to displace the illicit market”.

There are hopes this review will make changes to the rates of taxation, marketing restrictions and more representation of Indigenous peoples, racialized communities, and women in the industry.

The industry has, of course, come a long way since legalization, with dozens of companies now operating in Canada’s rapidly growing cannabis market, and many more set to go public.

Here are some of the key takeaways from the last four years:

  • Legal sales are now ahead of illicit sales in the country. In Ontario (who make up 39% of legal sales) legal market share has increased from 47.1% in 2020 to 54.2% in 2012. Nationally, 43% of cannabis consumers had bought from regulated sources, which is up from 37% in 2020.
  • The cannabis industry has created a huge number of jobs for Canadians, supporting an average of 10,900 jobs every year and a further 67,400 indirect jobs and 19,300 induced jobs.
  • Canada’s legal cannabis industry had contributed CA$43.5 billion to the country’s GDP between legalization in 2018 and 2021. In tax alone they collected CA$15.1 billion.
  • Whilst MSO’s and big business rule the market, they are losing market share to Canada’s many smaller craft cultivators and producers. Whilst these small businesses have ramped up, growing market share with premium cannabis products, many of the country’s largest LPs are downsizing and struggling to retain market share.
  • Legalization breeds innovation. The Canadian cannabis market has seen exciting innovations and new products brought to market since its rocky start in 2018.

Whilst there are positives there, there are of course still issues, many of them the Cannabis Review will hopefully address, such as high tax rates, oversupply and a lack of minority representation.

For today though, it’s worth celebrating four years since legalization, and four years Canadian’s have been free to use and enjoy cannabis without fear of repercussions.


For more insights into the Canadian market and its trends you can read the North American Cannabis Report: 3rd Edition for free. The report deep dives into all key sectors and geographic regions in the North American cannabis industry, with many data sources which have been exclusively obtained by Prohibition Partners, or else remain un-reported to date.

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