The Government of Ontario says it expects up to 1,000 cannabis retail stores to open in the province next year once it becomes legal for the private sector to sell the recreational drug at bricks-and-mortar locations.
The estimate comes a day after Queen's Park unveiled its regulations pertaining to retail cannabis outlets. The province says that it has determined a hard cap on 75 stores for each retailer based on the assumption that the province could support as many as 1,000 stores initially, or about 7.5% of the market. The cap is similar to Alberta’s rules that dictate one business cannot own more than 15% of the cannabis stores throughout the province.
Ontario’s cannabis regulations also pave the way for cannabis retail stores to open in shopping malls, according to the government. Allowing pot stores to open in shopping centres could potentially give a significant lift in sales and foot traffic to malls that have faced pressure from online retailers.
Meanwhile, the Ford Government also says that it expects to record a loss from its online cannabis store, and that tax revenue from cannabis sales will be lower than expected. The disappointing news concerning the government’s online cannabis store was contained in its fall fiscal update, which it released on Thursday of this week.
In an itemized list of its finances, the Ontario government said that it will lose $25 million in the 2018-2019 fiscal year operating the Ontario Cannabis Store, while receiving $17 million in revenue for its share of the federal excise tax applied to cannabis sales. Earlier projections showed Ontario was expected to earn $35 million in tax revenue in the first year that cannabis was legal throughout Canada.
