High taxes are about to kill California’s #marijuana market before it even gets started

The report by Fitch Ratings, “Local Taxes May Challenge Cannabis Legalization in California,” warns that state and local taxes may combine to threaten the government revenue expected from the sale of legalized cannabis and cannabis products. The recreational use of the drug will be legal in California starting Jan. 1 under Proposition 64, the Control, Regulate and Tax Adult Use of Marijuana Act, passed by voters last November.

The state will levy a tax of 15 percent on the purchase of all marijuana, including the sale of medical pot. Many local governments are still working out how best to cash in. Voters in the city of Salinas approved a tax of up to $25 per square foot of space used for cultivating, while further north, Humboldt County is more grower-friendly with a the cultivation tax that tops out at $3 per square foot.

More than 60 cities and counties have now passed new taxes on marijuana businesses with rates between 7.75 percent and 9.75 percent. Added to the state marijuana tax, state and local sales taxes and other business taxes, the tax rate on marijuana in California is likely to be the highest of any of the states that have adopted a policy of legalization.

Source: Pushing marijuana back into the shadows with high taxes

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2 comments

  1. You can thank jerry and his failing pensions for the massive taxation on everything in kaly.
    What will happen is that once it’s ” legal” ..LEO’s will start to find HUGE grow houses with the intent of exporting it. Eco 101 will kick in.. WHY buy it at absurd prices when . 1. You can grow 6 plants.. Plants that are properly grown can hit 7-10 ft high. Thats enough Buds for yourself an the entire block you live on for a year.
    2. The Black market is cheaper than Kaly;s legal reefer. / To stop the black market, Eco 101 says that it must be cheaper by the ounce, than the illegal market. Why in hades would you tax medical pot.. All states don’t tax the medical pot.
    Get ready for chaos and mayhem.. The entire state will be driving stoned out of their minds. It’s probably wasn’t a good idea to make it legal. I expect the productivity of Kaly’s workers to drop dramaticaly. Jerry is going to to find that in a short time, he has opend up Pandora’s Box. Other states may be more responsoble, but Kaly’s will
    be on a drug induced holiday 24-7 with results that may not be very good or safe for the rest of us here.

    Like

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