How much legal cannabis could raise in tax revenue – and why it might fail

By May 4, 2020 Recent News

NewsHub 1 May 2020
Family First Comment: So how good has alcohol and tobacco done at covering the significant health and societal costs? Terrible!!! It’s been a fiscal disaster.
The article also says…
“….but only if it’s good enough to wipe out the black market.”
As we already know, no place that has legalised has achieved that. Just 29% of Canadian cannabis users buy all of their product from a legal source. California’s projected marijuana tax revenue by July 2019 is nearly half of what was originally expected when the state began retail sales in 2018, since most consumers continue to purchase marijuana from the black market in order to avoid high taxes.
Just another smokescreen from the Drug Foundation’s friends.
Read more: https://saynopetodope.org.nz/black-market-continues/  https://saynopetodope.org.nz/social-costs-v-tax/

A new report shows a legalised cannabis market could raise $490 million in taxes each year – but only if it’s good enough to wipe out the black market.

And with the Government hoping to design it in a way that discourages use over time, the New Zealand Institute of Economic Research (NZIER) fears it might not be.

It’s released a new report into how the proposed legal cannabis system proposed by the Government might work. The findings are based on a similar report the group did a few years ago, but updated with new evidence collected from places where it’s been legalised recently, such as Canada and parts of the United States.

“The evidence from America is you can wipe out the black market if you have an open, regulated regime that allows customers to get access to the product they want and allows low-cost production,” principal economist Peter Wilson told Newshub.

“But the Government seems to be saying it doesn’t want that to happen – it doesn’t want a commercial market. It wants to see use reduced through time.”

The Government’s proposed scheme would see cannabis tightly restricted, with limits on potency and amounts any individual can possess at any one time. It would also be taxed – NZIER saying this could bring in $490 million.

“That is dependent on the legal market taking over from the illegal market, and we think the Government’s got to do a bit more work to do to make sure that happens. We hope there will be some more consultation and discussion before the legislation is passed.”

The fear is if the legal regime is too expensive or difficult to access, users will simply keep turn back to the black market.
READ MORE: https://www.newshub.co.nz/home/politics/2020/05/how-much-legal-cannabis-could-raise-in-tax-revenue-and-why-it-might-fail.html

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  • Leeanne Graham says:

    At a time the whole country has banded together to protect a vulnerable group of people, (the elderly and immune suppressed from Covid19) subsequently losing livelihoods in significant number, costs to future generations beyond comprehension, we have this unbelievable consideration of legalising and so making freely available yet another brain destroying drug. A consideration being the tax revenue from this recreational (feeder to stronger drugs and irreversible brain destructive) drug. Is this truly a revenue stream we want to adopt given what we’re all going through???
    Who are we????? What are we???? As much as the availability and abuse of alcohol has harmed communities due to its inappropriate use by many…. it is well documented the longterm harmful chemical changes and apathy (over and above that created by alcohol) that comes about through the repititive use of marijuana..
    It would be an extreme alcohol user (alocholic) who would wake in the morning to have a ‘fix’ before heading off to their jobs but to have a joint with a cuppa in the morning is easily imagined with just as damaging a result for then heading in to work. (If the user still has the motivation to do that)…….
    Again I can only consider politicians who support this legalisation of marijuana (for other than medically recognised and approved pain and seizure relief) are aiming for the ultimate goal of an unchallenging populace more intent on using drugs to reach their ‘happy place’ from a means other than embracing life, by taking the easier road of apathy which creates the environment for politicians and civil servants to continue with their own agendas without contestation.
    It’s not only this generation we need to consider – think ahead to the coming generations being born into what would be considered ‘a normal part of daily life’
    ………..Forget the drive for independent thinking, intellectual growth, entrepeneutrial ideas, excitement and gratitude for life and challenges – what the result of legalising recreational marijuana would be is the politicians and civil servants being the empowered shepherds as the flock unthinkingly follows due to the shortlived euphoric and longterm apathy recreational marijuana provides.

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