California Governor Proposes Marijuana Tax Cuts To Combat Illicit Market

California Governor Proposes Marijuana Tax Cuts To Combat Illicit Market
MJ moment

The governor of California unveiled an updated budget proposal on Friday that calls for the elimination of the state’s marijuana cultivation tax and revised cannabis tax revenue allocations. Gov. Gavin Newsom’s (D) May revised budget would take steps intended to combat the illicit market and make the legal industry more competitive, in large part by zeroing out the cultivation tax that marijuana businesses currently incur. It’s a move that stakeholders have been pushing for, especially as businesses have struggled to keep up with rising inflation and reduced demand compared to peak coronavirus pandemic levels. The governor emphasized on Friday that he was specifically committed to exploring ways to minimize the influence of illicit growers and sellers on undercutting legal, licensed businesses. And while one might assume that removing the cultivation tax would hamper revenue streams for the state, a recent analysis from the Reason Foundation actually found that monthly tax revenue would increase by 123 percent by 2024 if the policy change was enacted. Eliminating the cultivation tax would allow farmers and licensed cannabis retailers to lower prices, making California's legal marijuana market fare more competitive with illicit markets. — Reason Foundation (@ReasonFdn) May 13, 2022 The report said that ending the cultivation tax would mean lower costs for consumers and, therefore, increased legal purchases that would more than offset any revenue losses over time. Newsom’s proposal on its own isn’t binding, however. It would need to pass the legislature with at least a two-thirds majority in order to be implemented. *proposed to eliminate the cultivation tax*. 2/3 of the California Legislature has to approve this proposal so time to turn your attention, energy and advocacy to them. — Nicole Elliott (@NicoleElliottCA) May 13, 2022 “We’ve been working very closely with legislative leaders, and we’ve made tremendous progress,” the…

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Source : California Governor Proposes Marijuana Tax Cuts To Combat Illicit Market

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