August 03, 2018, Alaska
In the fiscal year 2017-2018, which ended on June 30, the state of Alaska collected $11 million tax revenue from the marijuana growers. The Alaska Department of Revenue estimated this collection to be around $9 million at the beginning of the fiscal year. It is worth noting that the amount doesn’t account for the tax collection from retail operations and other facets of legal cannabis operations.
Good revenue prospects have always played a decisive role in the legalization of cannabis in nearly every legal state. Lawmakers, who don’t support cannabis use on principle, are most likely to endorse legalization because of its benefits for the state exchequer.
The excise tax supervisor of the revenue department, Kelly Maazei, has talked to local media about the tax collection from marijuana businesses in the recently concluded fiscal year. According to her, in the month of June alone, the state has collected 1.2 million in taxes from marijuana cultivators. She strongly believes that this upward trend will continue in the next fiscal year as well.
It is important to note that tax collection is not just increasing, but also exceeding the projected amounts. This is a clear sign that Alaska’s cannabis market is nowhere near saturation. Due to the exponential growth of the cannabis market, the department is not projecting any numbers for now.
Half of the tax collected from legal cannabis operations is designated to Alaska’s new Recidivism Reduction Fund. This pool of money is then earmarked for several programs working for the rehabilitation of ex-offenders.
Apart from that, community residential centers for people affected by sexual assaults and domestic violence get funds from the revenue generated by Alaska’s cannabis market. Similarly, a substance abuse treatment program of the state is also funded by these collections.
Recently, Gov. Bill Walker has signed a new Senate bill into law. This will designate another 25 percent of marijuana revenues to different social programs. According to the lawmakers who sponsored the bill in the Senate, this money will go to the education programs associated with marijuana awareness. The rest of the collection will go into the state’s general fund.
The Department of Revenue is also contemplating on amending the current tax rates to provide respite to the cultivators. At present, all cannabis harvest is taxed at the same rates. The flower and leaves/stems are taxed at $50 are $15 per ounce respectively. Cultivators also have to pay the same hefty tax on low-grade and immature cannabis flowers. However, they don’t get good rates for this category of cannabis flower in the retail market.
The new proposition will put cannabis flowers into two categories. The high-quality cannabis will be taxed at the same rate of $50 per ounce, whereas the lower quality strain will be taxed at half of this rate. The department will continue to get feedback from the stakeholders and the public on this issue until 10 August.
Marijuana stays in the news, and Alice is always ready to keep us updated. A world traveler and lover of freedom, Alice knows what is going on, no matter where she roams. She specializes in marijuana legalization stories across the globe, with up to date... [read more]