Legal cannabis market ‘would be worth £1.25bn a year to government’

By September 16, 2013 Recent News

The Guardian 15 Sept 2013
Legalising and taxing cannabis could be worth as much as £1.25bn a year to the government, a study suggests.

The report, by the Institute for Social and Economic Research, quantifies for the first time the revenue to be gained from the regulation and taxation of the cannabis market in England and Wales.

It estimates that reduced enforcement costs, such as police, court and prison time and community sentences, could save £300m or more alone, with the remaining three-quarters of the net benefit come from tax revenue.

The paper, co-authored by Stephen Pudney, professor of economics at the University of Essex, balances revenue against potential costs, such as regulatory costs and increased health promotion initiatives.

Pudney said the report was not a definitive attempt to put a price on the cannabis market, but tried to set out what factors needed to be considered if such a policy were to be introduced.

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