The legal cannabis market in Connecticut is under serious threat from the high taxes that are being placed on the product. It’s only a matter of time before the current tax structure on cannabis in Connecticut kills the legal market like a savage with a knife in his teeth.
State lawmakers have a tax rate of up to 20 percent on retail cannabis sales, which would make it one of the highest taxed states in the country. Completely in line with the high tax rates of Massachusetts. Plus if a medical patient wants a rec product, they have to pay the sales tax too. What’s up with that? I thought it was “Patients First”? Bologna.
Legal weed in the Nutmeg State is simply too expensive for most consumers; pricing out many customers who would purchase cannabis legally. This will drive those folks back into the black and gray markets where they would be subject to none of the taxes saving about 50% on their purchases.
And it’s not just the consumers who are being hit hard by these taxes. Cultivators and retailers are also struggling to make ends meet, due to the high costs. With such a high tax rate, cultivators and retailers are struggling to turn a profit. This will be a major blow to the legal cannabis industry in Connecticut, which is already struggling to get off the ground.
The state sales tax is also problematic. It effectively creates a multi-taxation system structure that only further drives up the prices. To make matters worse, the state’s tax revenue projections from legal cannabis sales are far below what was initially expected.
Plus, think about it… With 280E in place, along with the taxation of 20% for CT, takes about 73% of the business earnings. That’s crazy. That’s just going to drive the prices up higher. No? Is the state even considering 280E? Someone in charge is saying “What’s 280E?” right now…
Legislators promised that legalization would create jobs and generate revenue for the state, but the high taxes will make it impossible for the legal cannabis industry to thrive. That if they can get past zoning.
This is also due in part to the fact that the alternative market still dominates the state, and it’s unclear how much of the market share the legal industry will be able to gain, if any at all.
The high taxes on legal cannabis are a serious threat to the industry’s future in Connecticut, and state lawmakers need to reevaluate their approach if they want the legal market to thrive.
Damn Nutmeggers…
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