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(Sacramento, CA) Today, California Governor Gavin Newsom signed a major marijuana tax cut into law, despite current marijuana tax revenues falling short of expectations. The law eliminates the marijuana cultivation tax and prohibits any increases on the excise tax for at least three years.
Marijuana executives claim that tax cuts are necessary to save their dying industry. In reality, California already has lower marijuana tax rates than several legal states. In Washington, the excise tax rate is 35%, more than double that of California's. Many advocates say marijuana tax cuts will hurt low-income youth, particularly by cutting much-needed prevention services and child care. Yet the industry bailout was prioritized over saving social programs.
"Despite promises from the industry, marijuana legalization never turns out to be the silver bullet for state budgets. In fact, legalization costs more than it brings in," said Kevin Sabet, co-founder and President of Smart Approaches to Marijuana (SAM). "California voters were promised tax revenue that would save their schools and fund addiction treatment when they approved Prop 64. Now, the California state government is breaking that promise."
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