The legal cannabis industry in California is taking a significant turn as new legislative orders are rolled out to slap high taxes on marijuana products.
The news is causing a general dismay in the state as prices are projected to increase more than twice their current tags.
More expensive weed
To give you some perspective, a good bag of weed that costs $35 today can jump up to around $50 to $70 once the new law takes effect.
On the other hand, the hefty tax money could be used to pay government costs. Yet, another side of it also points to the potential of a thriving black market fueled by frustrated customers who find legal weed too expensive.
Operators who are legally selling the products have been calling on regulators to be aggressive on shutting down rogue operators.
“It’s just going to help the illicit market thrive,” says Donnie Anderson, a Los Angeles medical cultivator and retailer. He adds that the state should put an effort in mitigating cost increases especially for patients who wouldn’t be able to shoulder the burden of expensive medical marijuana.
Starting this January, state taxes will include a 15 percent levy on purchases of all cannabis and its derivatives.
Aside from state-imposed tax laws, the local governments are also free to include their own taxes which would prevent uniform sales rates from city to city.
The tax increase is part of the state’s major plan to create a billion-dollar cannabis industry in the state but whether the cities are ready for that come January remains a question.