California Could See $1 Billion in Tax Revenue From Legal Marijuana

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In California, analysts are saying the state could see $1 billion in tax revenue from marijuana when a new legalization law becomes effective in 2018, according to a Nov. 29, 2016, article in the International Business Times.

The recently approved Proposition 64, which regulates marijuana much the same way alcohol is regulated, prescribes a 15 percent excise tax on adult-use and medical marijuana, and cities and counties can add additional taxes and regulations.

Since California legalized medical marijuana 20 years ago, about 1,700 dispensaries have opened statewide. Now that adult-use marijuana has been approved, officials with the California Board of Equalization anticipate 25,000 cultivators will register and start paying taxes.

Collecting taxes will be tricky for California because the federal government still prohibits marijuana. It also prohibits banking with entities that deal in federally illegal drugs.

Meanwhile, Colorado, a state with a seventh of California’s population, brought in $134 million in tax revenues from legal adult-use and medical marijuana during the first nine months of 2016, the International Business Times reported.

The staff byline designates content that has been written by a staff writer of MJINews.

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