According to research coming out of Ohio State University, Ohio stands to earn about $375 million tax revenue each year if the state legalizes recreational marijuana. This study, whose findings were published in time for the unofficial 4/20 marijuana holiday, relied on estimates of possible taxes to be levied if the legalization proposal is adopted as-is.
The team of researchers looked at the estimated population growth rate and annual tax revenue from half a dozen states with adult-use cannabis markets. The states looked at included Nevada, Michigan, Illinois, Colorado, Washington and Oregon. The team also analyzed the proposed taxes included in the draft legalization measure. Based on this data, they came up with projections detailing how much Ohio could earn as tax revenue when the marijuana market matures.
Depending on how optimistic one is when predicting the growth trajectory of the Ohio adult-use recreational cannabis market, anticipated taxes could be anywhere between $276 million and $375 million each year by the time the industry reaches its fifth year of existence. Compared to the annual state budget amounting to approximately $60 billion, this tax would be a tiny drop in the funding basket of Ohio.
The researchers also note that their study had a number of limitations based on assumptions such as prices, the roll out of the market, regulatory challenges and marijuana consumption patterns as well changes in the tax structure. Any of these factors could alter the market and the subsequent taxes generated, the team notes.
It isn’t also clear whether the proposal to legalize adult-use cannabis will be passed by the lawmakers. They are being forced to consider the initiative after advocates collected a total of 133,000 voter signatures. If the legislature refuses to endorse the proposal, the campaigners will have no choice but to gather the same number of voter signatures in order to put the issue before voters during this year’s ballot.
Taking the matter to voters is looking increasingly likely given that previous endeavors to enact marijuana reform through legislative means have been futile. Leading Republicans in the state legislature have even signaled that they will not support the push to legalize recreational marijuana in the state, so it is likely to be an uphill task for this proposal to gain legislative approval.
When this process ends in an enabling law being passed, Ohio could open its doors to licensed companies such as American Cannabis Partners and begin reaping tax revenue and other economic benefits in the way other states with regulated markets are doing.
NOTE TO INVESTORS: The latest news and updates relating to American Cannabis Partners are available in the company’s newsroom at https://cnw.fm/ACP
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