WEED FEED / John Ross Ferrara / Monday, Nov. 13, 2017 @ 9:58 a.m.
Weed Feed: Price of Pot Could Jump by 70 Percent Next Year; State Treasurer Wants Armored Cars to Reel In All the Tax Dough
Expect to pay more for your weed when California’s recreational cannabis law takes effect this January.
Pot prices are anticipated to surge as new taxes and fees are attached to the market, which state legislators hope will generate $1 billion in additional tax revenue.
Starting next year, the state will impose a 15 percent tax on both medicinal and recreational marijuana sales. Additionally, local governments will have the power to mandate their own taxes on marijuana sales and cultivation.
The agricultural town of Salinas, for example, reportedly plans to tax growers $25 per square foot of cultivation, which adds up to $1 million an acre. Meanwhile, in Humboldt County, growers will be taxed between $1 and $3 per square foot.
This discrepancy in costs has some wondering if black-market sales will benefit from the price increase, and Humboldt County Supervisor Ryan Sundberg said he wanted a tax rate that would incentivize Humboldt County growers to go legit.
“A high tax rate, that would be one more barrier to getting people regulated,” Sundberg told NPR.
Because marijuana is still illegal at the federal level, much of the tax revenue generated from recreational marijuana will likely have to be paid in cash, a proposition that has the state treasurer suggesting California use armored vehicles to transport the tax money, NPR reports.
These tax structures will likely be a work in progress as California adapts to the supply and demand of the market. Comparatively, Washington and Colorado both reduced taxes on recreational marijuana after the legal market took effect.
For you California stoners out there, recreational weed is just 48 days away.
The Weed Feed is a weekly column written by John Ross Ferrara.
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