Interesting story out of California last week where the marijuana industry is sending an SOS letter to the state government saying their legal industry is on the verge of collapse. The gist of the story is that higher taxes, not enough locations, too many fees, and too many consumers going to the illicit market are causing a financial firestorm for legal marijuana businesses. The most striking line of the article out there is that 73% of cannabis transactions occur on the illicit market in California, and not the licensed, legal one. This is bad for legal businesses. No taxes are paid on illegal sales, no revenue is created to pay for those state marijuana licenses, no 280E tax code relief, and a whole lot of fees for software, banking, and technology. The state has pledged $100 million to help figure out the legal cannabis industry. But that just tells half the story of why the cannabis industry may have just hit its first maturity point as an industry as a whole. For consumers it was never about legalization; it was about accessibility.
Terry Hacienda, The Fresh Toast, 01/05/2022 13:13:00