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California slapping high taxes on marijuana, causing sticker shock for some
L A Times ^

Posted on 11/05/2017 7:37:00 PM PST by BenLurkin

On a retail level, it costs about $35 to buy a small bag of good quality medical marijuana in Los Angeles, enough to roll five or six joints.

But in 2018, when recreational sales take hold and additional taxes kick in, the cost of that same purchase in the new market is expected to increase at the retail counter to $50 or $60.

Medical pot purchases are expected to rise in cost too, but not as steeply, industry experts say.

Or consider cannabis leaves, a sort of bottom-shelf product that comes from trimming prized plant buds. The loose, snipped leaves are typically gathered up and processed for use in cannabis-laced foods, ointments, concentrates and candies. Growers sell a trash bag stuffed with clippings to manufacturers for about $50. But come January, the state will tax those leaves at $44 a pound.

That means the tax payment on a bag holding 7 or 8 pounds would exceed the current market price by five or six times, forcing a huge price hike or, more likely, rendering it essentially valueless.

“All it would become is compost,” predicted Ryan Jennemann of THC Design in Los Angeles, whose company has used the leaves to manufacture concentrated oils.

...

Come January, state taxes will include a 15% levy on purchases of all cannabis and cannabis products, including medical pot.

Local governments are free to slap on taxes on sales and growing too, and that has created a confusing patchwork of rates that vary city to city, county to county.

In the agricultural hub of Salinas, southeast of San Francisco, voters approved a tax that will eventually rise to $25 a square foot for space used to cultivate the leafy plants, a rate that’s equivalent to about $1 million an acre.

(Excerpt) Read more at latimes.com ...


TOPICS: Business/Economy
KEYWORDS: blackmarket; california; cannabis; high; marijuana; potheads; taxes
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To: Snickering Hound

That’s a lot of baby arms....

Good trellis work


41 posted on 11/05/2017 10:59:04 PM PST by wardaddy (Virtue signalers should be shot on sight...conservative ones racked and hanged then fed to dogs)
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To: Ken H

I don’t see how that changes anything. You complained, I responded. The OP says “sticker shock” and shows prices going up steeply. I didn’t need my MBA degree to know that when prices go up, people look for alternatives. When they find those alternatives, the original “revenue streams” decrease.


42 posted on 11/05/2017 11:04:21 PM PST by ransomnote
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To: ransomnote

So back to my original point. You claim that they’ll just buy it in the black market for cheap and legalization will be a cover for black market sales. So how do you explain the hundreds of millions in tax revenues that CO and WA are pulling in a year on sales in the billions?

That’s a big chunk of the market.


43 posted on 11/05/2017 11:14:42 PM PST by Ken H (Best election ever!)
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To: Ken H

So back to my point that we haven’t seen the full impact yet. The OP says in 2018, taxes will raise the price from $35 to $55-$60. In 2018 we’ll see the black market boom as people want to keep their pot budget closer to the $35 dollar range. Basic law of supply and demand, particularly as high school and college students have limitations and habits. Basic market pressures in play here.

Here’s an article saying that the new taxes will be used to crack down on illegal pot growers in Colorado (i.e., the black market).
“A measure signed into law by Gov. John Hickenlooper sets aside nearly $6 million a year in Colorado marijuana tax revenue to reimburse police for investigating black-market marijuana activity that authorities say has increased since the state legalized recreational marijuana in 2012.”
https://www.usnews.com/news/business/articles/2017-06-08/colorado-marijuana-market-funds-busts-of-illegal-growers

The article indicates that the black market is hard to address because illegal growers wishing to market to out of state sales set up massive growing operations in rural areas that lack sufficient funds to police them. Those operations aren’t exactly going to dry up once the price jumps up.


44 posted on 11/05/2017 11:34:09 PM PST by ransomnote
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To: ransomnote

On not in favor of legalization, but raising taxes, then using the tax money for enforcement, etc., just seems like they’re chasing their tails.


45 posted on 11/05/2017 11:40:02 PM PST by Flaming Conservative
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To: Flaming Conservative

Yeah it seems like circular reasoning to me. :)


46 posted on 11/05/2017 11:49:51 PM PST by ransomnote
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To: BenLurkin
Anyone that that thought the government could be heavy handed enforcing marijuana laws is going to discover that was nothing compared to] how they enforce it's taxation.

Finally, a tax liberals can hate

47 posted on 11/06/2017 1:43:14 AM PST by rdcbn
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To: BenLurkin

I’m reminded of the time Johnny Carson asked George Carlin something to the effect of “what can be done about the drug problem?” George responded “bring the price down”


48 posted on 11/06/2017 2:59:20 AM PST by Artie (We are surrounded by MORONS)
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To: Billthedrill

Exactly!
A Guy told me that...
My Sister’s friends.

Yes ..thats the ticket.
Morgan Fairchild.
Yes.


49 posted on 11/06/2017 4:29:04 AM PST by Big Red Badger (UNSCANABLE in an IDIOCRACY!)
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To: Big Red Badger

Yeah we didn’t even weigh it.


50 posted on 11/06/2017 7:43:24 AM PST by ex91B10
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To: Ken H
The black market doesn't offer the extracts and edibles that the dispensaries do. There will be revenues raised by those. Plus, there's the variety available in dispensaries. Some folks buying weed aren't just buying a high. No more than everyone that goes to a liquor store is looking for a bottle of grain alcohol. “Connoisseurs” with disposable income must be legion in Cali.
51 posted on 11/07/2017 11:33:19 AM PST by gundog (Hail to the Chief, bitches.)
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To: Noumenon

“Har de har har. The irony is delicious.”

Government is a racket that would make Capone blush.

L


52 posted on 11/07/2017 11:35:20 AM PST by Lurker (President Trump isn't our last chance. President Trump is THEIR last chance.)
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To: Snickering Hound
You're legally allowed to grow 6 plants and entrepreneur hippies will grow huge weed bushes and undercut your price.

At which point, the state will sic the feds on them.

53 posted on 11/07/2017 11:37:10 AM PST by AppyPappy (Don't mistake your dorm political discussions with the desires of the nation)
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To: AnotherUnixGeek

In San Diego back in the summer of 1968, we bought a kilo of run of the mill Mexican for $12.00 US delivered to our apartment. Could have gotten it for $8.00 in Tijuana. There were lots of seeds and sticks, but come on, man.


54 posted on 11/07/2017 11:38:29 AM PST by VietVet876
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To: BenLurkin
He got weed! He got weed!


55 posted on 11/07/2017 12:06:50 PM PST by BlueLancer (ANTIFA - The new and improved SturmAbteilung)
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To: ransomnote
Colorado youth now rank number one in the nation for marijuana use and 74 percent higher than the national average.
Colorado college-age group now rank number one in the nation for marijuana use and 62 percent higher than the national average.

According to drug enforcement - no vested interest there, right? - and contrary to several other studies.

56 posted on 01/04/2018 4:14:37 PM PST by NobleFree ("law is often but the tyrant's will, and always so when it violates the right of an individual")
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To: NobleFree

Thank you for digging that up. WHenever I look I have to wade hip deep through the distorted “studies” bought and paid for by the massive pot lobby. But when I post stuff like that, the pot heads flat out don’t care. Pot’s negative effects on motivation, memory and learning are well documented but pot heads don’t care. They change the subject and go on their merry ways. Marijuana must flatline empathy as it creates emotional dependence; that must be it.


57 posted on 01/04/2018 4:18:37 PM PST by ransomnote
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To: ransomnote
So every study that doesn't fit your preconceptions is "distorted" and "bought and paid for by the massive pot lobby" - but drug enforcement agents are an unbiased source of data.

ROTFLMAO!

58 posted on 01/04/2018 4:23:09 PM PST by NobleFree ("law is often but the tyrant's will, and always so when it violates the right of an individual")
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To: NobleFree

Wow! I’m RIGHT! Pot shrinks the part of the brain that handles empathy!
“The scans revealed that smoking cannabis every day was associated with shrinkage in the orbitofrontal cortex (OFC) region of the brain, which is involved in mental processing and decision making.

It also influences responses to rewards and adversity, and is strongly linked to empathy – the ability to sense other people’s feelings.

Neuroscientists believe damage to the orbitofrontal cortex may underpin some forms of psychopathy.”

https://www.theguardian.com/society/2014/nov/10/cannabis-smoking-brain-shrinks-increases-connectivity-study-texas

That explains why the pro pot lobby just doesn’t care about anything but getting access to it.


59 posted on 01/04/2018 4:24:37 PM PST by ransomnote
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To: ransomnote
the ability to sense other people’s feelings.

You're the one who can't seem to sense the feelings of drug enforcement agents confronted with a potential reduction of their sphere of authority and their budget.

60 posted on 01/04/2018 4:54:18 PM PST by NobleFree ("law is often but the tyrant's will, and always so when it violates the right of an individual")
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