During the last quarter, California raked in $208.4 million in tax revenue from cannabis. In comparison, this figure was slightly higher when compared with revenue from the first quarter of the year, the CDTFA reported last Wednesday.
Despite many industries declining in output or failing, the cannabis market seems to be operating at even greater efficiency, as the report from California shows.
The $208.4 million did not factor in tax revenue that was collected by each jurisdiction. In the first quarter of 2020, tax returns were $205.9 million, this is including the $26.9 million in cultivation tax, $107.4 million in cannabis excise tax as well as $71.6 million in sales tax.
Since retail sales for cannabis were put into effect, the state has amassed $1.45 billion in marijuana tax revenue. The figure is inclusive of sales, excise and cultivation taxes.
In line with a recent study, if bans on marijuana businesses were lifted, the revenue would increase. As for now though, 75% of counties and cities in the state still implement cannabis market bans. This is despite a statewide vote carried out in 2016 that legalized the plant for adult use.
While the California Department of Tax and Fee Administration analysis showed growth in revenue, the Legislative Analyst’s Office released a report on the same that cited a 7% decline in the same time period. However, they did not take into account sales tax and exclusively focused on cultivation and excise tax revenue. This accounts for the difference in the findings of the agencies.
The analyst who did the LAO report, Seth Kerstein, stated that they chose to omit data from sales tax citing problems with the accuracy of the methods used to acquire that data.
In Illinois, legal cannabis purchases are increasing steadily. The state of Illinois launched cannabis retail sales earlier this year in January. In July, it experienced an additional record-breaking month with recreational marijuana sales in the month adding up to an estimated $61 million. This number, was higher than the previous month’s record, which raked in a whooping amount of about $47 million.
Additionally, in Oregon, a similar trend in cannabis sales is being experienced by officials, in the middle of the global health pandemic. The data that was reported in May indicated that the adult-use cannabis sales had grown by a 60% margin.
Analysts say sector players like The Alkaline Water Company Inc. (CSE: WTER) (NASDAQ: WTER) will feel vindicated since the industry has always asserted that having a regulated marijuana market will open untold economic benefits for states.
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