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Washington State Senate Votes To Eliminate Marijuana Excise Taxes

marijuana taxes tax

(via dailyfinance.com)

I have long said that if the black market for marijuana is going to be eliminated, legal marijuana prices have to be lower, or at least close to lower, than prices on the black market. I’m all for paying a bit more at a store, but when someone can get marijuana on the black market for 5 dollars a gram, and it costs 19 dollars a gram at a store, that’s not going to work. That is the case in Washington State, where the tax structure for marijuana is hurting the industry quite a bit. This week the Washington Senate voted to make big changes to the tax structure for marijuana. Per Marijuana Business Daily:

There may be a glimmer of hope for what is widely considered an untenable tax structure in Washington State.

The Washington State Senate passed a bill removing the excise tax on recreational marijuana sales by producers and processors, and will tax only retail sales.

As it stands, a 25% excise tax at three transfer points: when producers sell to processors, when processors sell to retailers, and when retailers sell to end consumers. Business owners in the industry say that tax structure inhibits their ability to do business and drives up prices.

The new bill proposes a one-time tax of 37% on retail sales.

I still think a 37% tax is too high, but that’s less than half of what it is now (25% times 3). I would like to see Washington move to a tax structure like what Oregon is going to have, which should be a flat rate of $35 per ounce. That of course is assuming the Oregon Legislature respects the will of the voters. If that proves to be the case, Oregon would have the lowest marijuana taxes in the country, and would be bordered by Washington which would have the highest.



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  • Joshob1987

    Great, the taxes are passed on to us now. The tax was fine before but this excise bullshit is gonna force me and many others back to the black market. This whole thing is going to fail now because prices are not competitive enough. Excise tax is fine for processors and retailers that can afford it, but I will gladly go back to the shitty experience of meeting someone in a parking lot just to avoid it.

  • Sinclair

    First of all I would rather have grow your own. Second this artical was about a reduction of taxes. Currantly in the state in the artical the grower pays a tax, the seller pays a tax and the buyer pays a tax. Being so the grower charges the seller for the tax to cover their cost. The seller then has to pay therein own tax and the up charge from the grower. These taxes are passed on to the consumer ( the buyer ) who ends up paying for all the taxes including the sale tax of the buyer. Now if the tax rate changes and is reduced to only the consumer (buyer) than There is no reason to up charge the taxes that no longer exist from the grower to the seller a d only the Bauer has a tax. So naturally being those other taxes don’t exist the price goes cheaper unles your a greedy M.F. and just want to rip people off. So what don’t you get?

  • Nathaniel

    Your assertion about folks lack of love for quality products is quite true. If there is a similar, less refined, product that has near the same level of THC, that a higher end/well grown product contains, and that poorly produced product has a far lower price point, most consumers will opt for the garbage alternative.

    I am not certain I would agree with the idea that the taxes collected are meant to reduce consumption, thus reducing the number of couch lock morons who try to drive or otherwise endanger the public in some way. I am pretty sure that higher taxes are merely meant to keep the establishment’s coffers full: Altruism, or greater public safety, may be the rhetoric that gets sold to constituencies, but is not the end goal. Those that run governments are just greedy, nothing more.

  • Dan Bontio

    Not sure if you’re agreeing or disagreeing (or both)…

    Court fees are a far better policy than the Drug War. And even an imperfect market is far superior to a criminal black market.

  • Bongstar420

    1 dose of Tomatoes = 150g
    1 dose of Cannabis flower = 0.08-0.2g

    1 dose of Tomatoes= $1.50
    1 dose of Cannabis flower = $2.00 at $40/g

    Tomatoes have growing regulations..they just don’t have a excise tax because they are considered good.

    I am far less concerned about Tomato abuse vs Cannabis abuse. Tomatoes do not give you euphoria and make being a lazy loser rewarding. Tomatoes do not make dumb people dumber either or cause non-impaired people to become impaired.

  • Bongstar420

    WA tax does not stop prices from being low. Oregon tax does because it is flat.

    WA people are taxed on percent of price which they can set to anything. Oregon is taxed $35/oz which translates to absolute minimum of 35×2/.66=$106/oz wholesale.

  • Bongstar420

    The same goes for Coca and Opium plants
    Henbane too


  • Bongstar420

    Thats because people do not voluntarily share in ways that are not what they want.

    We can’t just pass a law telling Sadam to play nice, it has to be enforced to have meaning.

  • Bongstar420

    Tobacco pays a 50% tax. Alcohol pays $22/gal sprits and $0.04/gal beer.

    Obviously the establishment prefers beer.

    Taxes are going to be higher the easier it is to produce. The tax is meant to reduce consumption and ameliorate the effect of morons being more impaired than usual.

    Ethanol is easier to produce than pot and yet people don’t have that perception…thats because they need time to learn that Ethanol is not premium spirit or beer. The popularity of self production with the idea that anyone can produce high quality outputs is more of an issue than profitability. If consumers preferred qualified producers, no price would support uncertified producers.