Cannabis Tax Intel

California’s annual cannabis sales fell in 2022 for the first time since adult-use launch

Published

2 years ago

February 25, 2023

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Mj Biz Daily write

Annual cannabis sales in California declined in 2022 for the first time since the state launched its adult-use market five years ago, according to state data analyzed by MJBizDaily.

Retailers generated just over $5.3 billion in taxable sales of recreational and medical marijuana last year, down 8.6% from roughly $5.8 billion in 2021, according to the latest statistics released by the California Department of Tax and Fee Administration.

Taxable sales in the fourth quarter dipped to about $1.3 billion – the third straight quarterly decline – down nearly 12% from the same period a year ago.

Depressed wholesale prices, which have made products cheaper for consumers, and the continued lack of retail outlets across wide swaths of the state have been two big drivers of this trend, according to California cannabis industry consultant Hirsh Jain.

“California’s ‘dual-licensing’ system has made it very difficult for new dispensaries to open in the years since adult-use sales began,” said Jain, the principal of Los Angeles-based Ananda Strategy.

Under California rules, cannabis businesses must obtain local authorization from the city and/or the county in which they operate before they can apply for a state license.

This system has caused major delays in issuing annual licenses since the launch of adult-use sales in 2018.

Read full article at

https://mjbizdaily.com/californias-annual-cannabis-sales-fell-in-2022-for-the-first-time-since-adult-use-launch/

STATS

2022	Q4	$108,045,315	$0	$113,600,546	$221,645,861	$1,273,317,480
2022	Q3	$135,403,051	$0	$115,914,817	$251,317,868	$1,294,730,605
2022	Q2	$147,688,374	$27,797,259	$125,910,698	$301,396,331	$1,411,750,487
2022	Q1	$155,072,502	$37,685,502	$118,813,877	$311,571,881	$1,327,688,715
2021	Q4	$160,983,530	$40,090,205	$129,451,952	$330,525,687	$1,445,373,416
2021	Q3	$177,453,322	$43,418,896	$127,955,144	$348,827,362	$1,429,266,150
2021	Q2	$180,434,103	$42,521,801	$138,905,009	$361,860,913	$1,565,098,988
2021	Q1	$162,167,667	$40,367,175	$118,261,146	$320,795,988	$1,340,624,407
2020	Q4	$154,606,825	$42,688,451	$118,040,735	$315,336,011	$1,331,895,518
2020	Q3	$169,515,480	$43,386,101	$119,280,025	$332,181,606	$1,343,093,888
2020	Q2	$137,720,149	$30,867,256	$101,973,139	$270,560,544	$1,153,228,932
2020	Q1	$112,877,640	$27,646,731	$77,778,420	$218,302,791	$877,039,109
2019	Q4	$86,897,511	$24,662,913	$70,925,039	$182,485,463	$799,185,962
2019	Q3	$84,887,286	$22,809,108	$65,839,748	$173,536,142	$742,701,526
2019	Q2	$75,731,295	$23,037,243	$60,370,850	$159,139,388	$681,999,378

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Cannabis Tax Intel

Maryland: Senate recreational cannabis bill differs from House bill over taxes

Published

2 years ago

March 29, 2023

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WBAL TV

The Senate’s bill to map out the legalization of recreational marijuana in Maryland differs greatly from the House proposal over taxes.

Legislation making recreational cannabis legal in Maryland still has a long way to go in a relatively short period of time. And, changes made by the Senate Finance Committee could set up a showdown between the House and Senate.

But legislative leaders put an optimistic spin on the changes, calling the differences minor and will be easy to resolve.

“This is one of those bills that everyone has just one more idea. So, the faster we can get to a place of resolution, I think will be better for everyone,” said Senate President Bill Ferguson, D-District 46.

Early this month, the House gave preliminary approval to House Bill 556, which would tax and regulate marijuana.

Under the Senate version, Senate Bill 516, it would cost Marylanders more to recreational marijuana use. The sales tax would go up from 6% to a 9% flat tax, and local governments would be allowed to tack on an additional 3% sales tax.

“While it’s not perfect, I think it offers enough good points for us to be able to move the bill forward,” said Sen. Clarence Lam, D-District 12, whose district encompasses portions of Anne Arundel and Howard counties.

Under the House bill, cannabis would be taxed at 6% for the first year and increase by 1% each year until 2018. It would be capped at 10%.

The Senate bill would still allow people to possess up to 1.5 ounces of cannabis, and current medical cannabis businesses would be allowed to convert their licenses to recreational before July 1.

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Cannabis Tax Intel

New law could increase taxes on cannabis sales in Montana

Published

2 years ago

March 29, 2023

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BILLINGS, Mont. — In the state legislature cannabis is once again taking center stage. This year, a proposed bill is seeking to undo almost all of the policy changes that were voted into effect by Montanans.

If this Bill were to pass, it would have a major impact on those who not only use cannabis recreationally but also impact the business owners and employees of Montana’s dispensaries. Zack Schopp, owner of Seed of Life Labs in Billings said the ripple effects of a law like this — would go beyond the marijuana industry.

“It’s detrimental to the business, to the employees of those businesses, to those government regulators who are employed, to the contractors of the building, to the real estate agents that are selling property. All of that economic opportunity that’s been created from cannabis is at stake with a Bill like that, there are over 5,000 Montanans who have jobs in the cannabis industry here, you know, what am I supposed to say to them if this goes through,” said Schopp

His business is just one of more than 40 dispensaries in the area according to the department of revenue, Yellowstone County generated an estimated $4,000,000.00 in Tax revenue in February of 2023.

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Cannabis Tax Intel

New Jersey Moves to Remove State’s 280E Tax Code

Published

2 years ago

March 29, 2023

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Via Cannabis Industry Jnl – very intreresting development as and when Murphy signs off on it

The New Jersey legislature recently approved legislation that would allow licensed cannabis businesses to deduct ordinary business expenses on their state tax return that they are prohibited from deducting on their federal tax return, and such legislation has been sent to Governor Phil Murphy to potentially sign into law. This relates to the universally dreaded (among those in the cannabis industry, at least) Section 280E prohibition. This legislation is important because it would change current law to allow legal cannabis businesses in New Jersey to operate on more of a level playing field with other businesses in the state.

Cannabis operators and applicants are penalized by their inability to deduct certain expenses on their state and federal tax returns. The cause for this frustration is twofold. First, under federal law, cannabis is considered a Schedule I controlled substance under the Controlled Substances Act, 21 U.S.C. § 801 (CSA). Second, under IRS Tax Code Section 280E, cannabis businesses that are legal under state law are still considered drug traffickers for the purposes of federal tax law. While a related issue that is often considered along with Section 280E is whether or not it is sound public policy to continue to classify cannabis as a Schedule 1 drug, that is beyond the scope of this article.

While New Jersey’s legislators can’t change federal tax code, they are taking action to revise New Jersey’s tax code to level the playing field. Let’s hope the Governor signs into law the pending New Jersey legislation to decouple New Jersey’s tax law from Section 280E.

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