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

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