With an estimated revenue of $5 billion, California is set to emerge as the nation’s biggest cannabis market. With the conclusion of California’s waiting game on recreational marijuana sales legalization, the golden state will help millions get legal access to recreational cannabis.
But if you were expecting to see a crowd of marijuana enthusiasts line up overnight in front of retail marijuana stores, you’re up for a big disappointment. When the clock strikes 12 on New Year’s Eve, the question of whether you will be able to make legal purchases of cannabis would depend on whether you are a recreational user or a medical marijuana user.
After reports of 45% tax rate on recreational cannabis, Californians are now forced to undergo delays in fulfilling their much-anticipated wish of consuming marijuana from next year onwards. A year after more than 56% voters approved Proposition 64, most California cities are not ready to apply to the state for a temporary business permit, as per the Bureau of Cannabis Control.
Alison Malsbury, a cannabis-specialized attorney commented, “If you’re a medical card holder, going out for a celebratory joint on New Year’s Day will be doable, but for non-medical consumers, that will only be feasible in a few jurisdictions.’’
Among the 34 Orange County cities, only Santa Ana is planning to permit retail cannabis shops. Meanwhile, the state’s two biggest markets, Los Angeles and San Francisco are still in midst of developing regulations governing local permits for helping growers and sellers apply for a state license. Check out this list of marijuana dispensaries in California providing marijuana sales and services in your region. But apart from limited access to retail cannabis, lies another hurdle for California’s marijuana industry.
In a report published by Fitch Ratings, taxes on legal marijuana in California can lead most of the state’s consumers to the black market.
Since higher taxation is expected to discourage illicit market farmers from entering the legal market, the total tax collection is predicted to fall. While this could persuade lawmakers to adopt a ballot measure to reduce state’s excise duty, it is not likely to be passed until next year.
As stated earlier, medical marijuana users would enjoy uninterrupted access to medical marijuana, even if cities and counties have voted against allowing retail sales.
Come 2018, Producers, sellers and consumers of marijuana are predicted to be taxed heavily. In addition to a 15% state excise levy and cultivation taxes, cities will also charge a sales tax. Fortunately, medical marijuana users with a valid MMJ recommendation are exempt from paying sales tax and can save up to 25% taxes.
And that’s not all. Medical marijuana patients with a valid medical marijuana recommendation would receive a number of additional advantages ahead of 2018 legalization such as higher possession and growing limit, better access to state’s marijuana dispensaries, legal protection in traveling with cannabis and consuming cannabis at just 18 years of age.
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