Marijuana Dollars & Cents – The Bee -The buzz in Bullhead City – Lake Havasu City – Kingman – Arizona – California

As the country abandons decades of myth, propaganda, and misunderstanding, marijuana and related products have become more acceptable. A number of states now allow the sale and possession of marijuana and some are clearing records of convictions. And at the federal level, there are proposals to drastically change the legality of owning or selling.

This has made possible the establishment of pharmacies like The Bud Farmacy in Needles, California. It has also given states a powerful new source of income.

Recreational marijuana sales became legal in Illinois on January 1, 2020. And the state began collecting up to 41.25% taxes on some marijuana products. Then there were district and city taxes. And there was a state wholesale tax of 7%. Taken together, Illinois had some of the highest taxes on marijuana products in the country. It was recently reported that the state withdrew $ 52,783,471 from these taxes for the 2020 calendar year.

As with regulating marijuana and related products and perceiving their benefits or drawbacks, there are huge differences in both regulation and taxation. In stark comparison to Illinois, Michigan’s total tax on recreational marijuana products is a flat 16%. Yet the state deducted $ 288,183,493 from that tax in 2020.

Illinois is the only state that uses a tiered taxation system. For example, there is a 10% tax on products that contain less than 35% THC. Products with more than 35% THC at 25%. But cannabis-infused edible products are taxed at 20%.

Further confusion is created by separate categories of taxation and regulation for medical marijuana. And in 2020, the state expanded the conditions for which medical marijuana can be prescribed to a patient. As a result of an investigation, an investigation found that some Chicago pharmacies provided their customers with a list of cooperating doctors from whom they could obtain a health card. This would allow them to avoid at least 25% of the taxes imposed.

California leads the way in collecting taxes on recreational medical marijuana products. In 2019, this state had legal sales of around $ 3.1 billion. This earned the state $ 1,031,879,926 in tax revenue.

Tax revenues in other states are just as impressive. In 2020, Colorado grossed $ 387,480,110. Washington State generated $ 469.2 million in revenue over the same period, and Oregon added $ 133.150.349 to its state coffers.

Alaska offers an interesting case study. Marijuana tax revenue is split 25% to the general fund, 50% to the Department of Public Safety, Health and Social Services and the Department of Justice, and 25% to a marijuana education fund.

Income has increased significantly since 2017. That year the state raised $ 1,749,497. Three years later, in 2020, that number had risen to $ 24,213,296.

As the evidence mounts, states that have steadfastly opposed marijuana legalization will find it difficult to go against the tide. Recently, the Tax Foundation completed a study estimating excise tax revenues in states with a market that has been in operation for at least three years. Using the average excise tax numbers and the estimated number of residents using marijuana in each state, they then estimated the potential for tax revenue through 2023. There is no doubt that these studies will encourage states to reassess their positions.