California Is Raising Cannabis Taxes Again; Difficult for Legal Cannabis Market to Survive

California Is Raising Cannabis Taxes Again; Difficult for Legal Cannabis Market to Survive

The cannabis industry has been flourishing since the US federal government legalized hemp for recreational purposes in December 2018. The Farm Bill legalized hemp with a maximum concentration of 0.3% THC per unit limiting the amount of psychoactive substance in a product.  Recently, the California Department of Tax and Fee Administration (CDTFA) announced that it might raise taxes on the legal cannabis industry once again. For an industry that is currently facing an economic downturn, the increased tax rates might be considered to be another blow.  On one hand, the illicit cannabis market is thriving, with non-compliant guidelines, offering significantly lower prices to consumers with high medicinal claims. This is giving a stiff competition to the legal cannabis industry which follows stringent guidelines issued by government bodies to ensure consumer safety and quality standards.  The CDTFA’s latest plan of increasing taxes will further expand the price point discrepancies between the non-compliant and compliant markets. The tax increment could drive away potential cannabis consumers from the heavily-taxed legal market if the renewed taxes are passed on to the consumers rather than taken in by the operators.  While the CDTFA describes its aim to enhance the quality of life for Californians by…

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Source : Cannabis Radar
Link to original : California Is Raising Cannabis Taxes Again; Difficult for Legal Cannabis Market to Survive
reposted by Cannabis News World

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