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Representatives of a legislative committee reviewing Massachusetts’ recreational cannabis law recently said that when it comes to taxing sales of the substance, legislators will look to strike a balance between increasing revenue for the state and discouraging the underground market. Democratic Representative Mark Cusack and Democratic Senator Patricia Jehlen were recently chosen to head the panel, which is anticipated to propose legislation later this year. Cusack said during an interview that it was important to find the “sweet spot” for cannabis tax.

Cusack stated, “We also want to make sure we are not overtaxing and sending people back to the black market.” The law, approved by voters in November, calls for a 3.75% excise tax on recreational marijuana sales that would be assessed on top of the state’s regular 6.25% sales tax. Cities and towns could assess an additional 2% tax on sales within their own communities. Cusack and Jehlen said that several states that had already legalized recreational marijuana, including Oregon, Washington, and Colorado, impose considerably higher tax rates.

Cannabis shops are not expected to open in Massachusetts until, at the earliest, mid-2018. The legislators said they would seek a tax rate that would be high enough to produce adequate revenue to cover regulatory and enforcement costs associated with the new law but low enough to prevent cannabis users from returning to illegal sources to buy the substance. Jehlen said the goal was to provide safe access to cannabis and “kill” the underground market.

The panel is also weighing other possible modifications in the law, including regulation of edible cannabis products and limits on the concentration of THC, the psychoactive chemical in marijuana. Legalization supporters have opposed the legislative review, noting the law was approved by about 54% of Massachusetts voters and should be given a chance to work before any changes are made. Legislators insist that the will of voters would be respected but suggest that few actually read the entire text of the ballot question before casting their votes. Cusack said, “I think there are some unanswered questions and room for improvement.”


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