Sin tax is a major source of revenue for states. Presently, as the use of marijuana is becoming more acceptable and its legalization processes ongoing, California is brilliantly exploiting what can be called a golden opportunity. A plethora of new taxes is out to regulate every part of marijuana use, growth and production.
Marijuana – legal but Pricey
In the process of legalizing the use of marijuana, California is regulating every aspect of the drug, from where it can be produced to how it’s fused into different products, for example, being used as an ingredient for brownies and cookies. Residents are beginning to discover the excess taxes attached to the legalization.
For example, a small sack of the drug will cost $35. It may seem expensive, but that’s cheap compared to what its new price will be after the enforcement of the new taxes in 2018. The same bag of marijuana will run between $50 and $60 – which is obviously about 70 percent increase.
New taxes apply to other uses of marijuana
It’s not only bags of marijuana being sold for recreational smoking that will attract high taxes. Even marijuana specifically sold for treating medical issues will also be subjected to the new high rates.
Leaves are grown to produce cannabis oil, candies, concentrates. Despite the fact that these substances aren’t for recreational smoking, a full bag of leaves which sells for $50, will attract a tax of $44 – which is almost two times the cost of one bag.
The taxes of a 7 or 8 pounds bag of marijuana would increase the total cost to 5 or 6 times the current market value. This implies a tremendous cost hike from traders down to buyers, making the cost of running the business way too high.
Like the vast majority engaged in the California weed exchange, Ryan Jennemann sees the increased taxes as another impediment to the legalization of marijuana. While the use of marijuana may now be legal, state is out to discourage the business by overtaking every aspect of the plant.