The California legal cannabis industry has seen a boom since its introduction for recreational use on the first of the year. With the boom in cannabis sales comes some unexpected hurdles that the market will have to overcome in the near future. After around three months of the market being legalized in the state, two main issues seem to come into play for all of those in the industry. The first of those issues is the high amount of taxes that have meant higher prices for consumers and less income for those producing the plant. The other issue is that recreational sales are continuing to increase by a large amount, but these sales have yet to meet or exceed the expectations of the government thus far.
Leaders in the government have begun to pass new regulatory measures to help ensure that the market will continue to hit benchmarks in the near future. At an industry conference with an estimated 600 people in attendance, many of the top leaders in the market have come together to discuss how the market can continue to grow and beat adversity. Government officials who spoke at the California Cannabis Industry Association conference spoke up stating that they are committed to making regulatory changes that will help the industry grow to its full potential.
Attendees at the conference also learned that many of those who were against the market in the government level, have since switched their views to help alongside in the fight for legal cannabis. Assenblyman Jim Cooper of Elk Grove, who has worked for over 30 years with the Sacramento County Sheriff’s Department, stated that he is working to help legitimate cannabis companies advertise across digital platforms to help get the word out about legitimate marijuana. Many illegal cannabis companies have found it easy to advertise for their products on several industry leading sites.
Cooper stated that, “black market businesses can advertise on Weedmaps. How fair is that?”
He stated that he would like to help build appropriate legislation to help ensure that the only companies in the industry that are allowed to advertise are the ones who are fully legal. One of the main issues with the cannabis industry has been the plight of the black market. With high taxes across the legal industry, many users have turned to the black market to get the medicine they need. Although this was an anticipated response to the market, lawmakers are continuously trying to fight against this, urging customers to try out the legal market.
Assemblyman Tom Lackey from Palmdale, stated that his approach to helping curb the black market is simple. One of the best things that the government could do at this point would be to lower the taxes across the board. With tax rates as high as 45% in some parts of the state, individuals have found it easier to just go to the illegal side of the market instead.
The black market has continuously been one of the largest proponents going up against this new legal market in California. This is why it has become increasingly more important to fight against this in the coming future. Out of the states that have laid groundwork for legal cannabis, Oregon currently has the lowest tax rates of all, followed by California, Colorado and then Washington. It appears that the most successful cannabis market is the one with the lowest taxes.
Individuals are always looking for the cheapest prices and unfortunately, this can mean going through illegal channels to get the medicine they need. Hopes are high that the near future will see an easing on the added amounts of taxes given to the public, so that the legal cannabis market can continue to flourish.