“Once you turn a market black, it’s hard to turn it back.” Legislators in California, as well as places around the world and across North America, are learning this is a very true statement. Cannabis became criminalized in the early 1900s. Since then, there have been countless individuals that have chosen to continue cultivating and distributing it globally.
These individuals have kept the plant alive and thriving. They have also helped millions of us to keep a packed bowl over the years. Today though, this market is changing to a legal one. Now regulators are trying to come up with ways in which to compete with the black market.
The Cali Black Market History Recap
The latest attempt is coming out of the state of California. California was arguably the first state in the U.S. to offer any form of legal cannabis stature. This was of course after the enactment of the MJ Tax Act in 1937 and later the implementation of the CSA.
California is also home to “The Emerald Triangle.” This “triangle” of 3 counties is known for producing some of the best weed in the U.S. It is also widely known for the mass number of illegal cannabis grows that have taken place in the area for decades.
Grows which have supplied the U.S. with a lot of weed over the years. Instead of buckling down enforcement in these areas, or offering weed cheaper on the legal market, regulators instead are suggesting giving tax breaks to “legal industry businesses” in the state.
The Bill and the Reason Why it Came to Be
The “Temporary Cannabis Tax Reduction Bill” is officially Assembly Bill 286. This bill calls to “temporarily cut state excise taxes for legal marijuana retailers from 15 percent to 11 percent and also suspend cultivation taxes altogether through 2022,” according to a report by CNBC.
This comes after the state brought in $101 million less in taxes during the first six months of 2018. $101 million less than what was projected and expected. They blame this shortcoming upon the mass tax rates on legal cannabis purchases. This of course in addition to other aspects such as banking restrictions.
Like anyone will tell you including the CEO of the Arcview Group Troy Dayton, “The whole California system for adult-use legalization implementation has been a mess.” According to Assembly-member Rob Bonta, this bill will allow businesses to establish themselves. “Once the legal marketplace has established its roots. Once it is on its way to success, the tax rates will return under this bill.”
Do you think the proposed temporary changes will be able to combat the black market in California? Give us a shoutout on social media and let us know your thoughts!