Last Thursday, Pennsylvania's Auditor General, Eugene DePasquale, published a report titled "Regulating and Taxing Marijuana." The report laid out what regulated cannabis market advantages would exist if marijuana was made legal for adult use.
Pennsylvania Seeing Green
The attention-grabbing report provides readers with data detailing potential financial benefits and revenue that a regulated cannabis market could bring the state of Pennsylvania.
Naturally, an auditor general would focus specifically on the money-making aspects of the market and DePasquale's new 14-page report suggests he sees green.
Data was used in a report from the Substance Abuse Mental Health Services Administration, and it was found that just under 800,000 individuals in Pennsylvania admitted to regularly using marijuana.
The Auditor General then took data from Colorado and Washington and found that cannabis customers would spend roughly $2,080 a year on marijuana. From these two figures, DePasquale calculates that the industry could bring $1.66 billion in annual revenue for the state.
More Regulated Cannabis Market Advantages
The $1.66 billion is just the estimates for sales and doesn't account for the economic benefit it would bring the state. A regulated marijuana market would also create business opportunities, jobs, investment opportunities, and decrease the legal system costs of criminalizing recreational marijuana.
Another big benefit DePasquale points out in the report is what the state could make on taxing the legal cannabis industry. The Auditor General envisions a 35-37% total tax rate for the industry; a 10 percent tax on producers and a 19 percent sales tax on consumers. This would also include a state sales tax of six percent and counties have the possibilities of imposing their own taxes of one to two percent.
Taxing this $1.66 billion industry at 35 percent could give Pennsylvania around $580 million in annual recurring tax revenue. DePasquale states that this revenue could aid programs like the Children's Health Insurance Program (CHIP). He also sees marijuana legalization as a way to decrease opioid use and addiction.
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