Report: Local Cannabis Bans Drive Black Market and Curb Potential Revenue

Cannabis is legal in California, but commercial bans are still in place in most cities and counties. One of the consequences, according to a new report, is the absence of millions in local tax revenue. 

The study was conducted by Applied Development Economics and commissioned by the California Hispanic Chambers of Commerce and Weedmaps. It looked at Stockton, San Bruno, and unincorporated Sacramento County as examples.

Stockton’s licensing system is new. Once it gets off the ground, it could net $824,500 to $3.9 million. There is no licensing system in San Bruno. But if there were, the city could see $235,300 to $1.1 million. Sacramento County could reap $1.2 million to $5.8 million annually if it weren’t for its extreme restrictions.

“Based on our independent and objective analysis, cannabis businesses show significant market potential for additional legal sales throughout California,” according to the report. “This would result in substantial increases in tax receipts for state and local governments if the number of retail cannabis establishments expands to meet local demand in those communities that do not currently have legal retail cannabis sales.”

The researchers also conclude that cannabis market bans are helping the black market thrive even after legalization.

Read more at Marijuana Moment


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