January 14, 2019

July 23, 2018, Pennsylvania

Last week, Pennsylvania’s Auditor General, Eugene DePasquale, presented a report titled ‘Regulating & Taxing Marijuana’. The report discusses the economic prospects of a regulated recreational marijuana market. The report has comprehensively talked about the economic prosperity legalized strain could bring in.  

It was already expected that the report furnished by the Auditor General will emphasize the monetary aspect of legal weed. Halfway through the report, readers will come across a two-word heading ‘$1.66 Billion’, a number that highlights the size of adult-use cannabis market of Pennsylvania. 

DePasquale hasn’t made any complex calculations to come out with cannabis-related economic activity. He has used sets of already available information to estimate the size of Pennsylvania’s adult-use cannabis economy. For instance, he has picked the statistics from the Substance Abuse Mental Health Services Administration, which reveals that around 800,000 Pennsylvanians have admitted to use cannabis on regular basis.  

Pennsylvania’s Auditor General, Eugene DePasquale
Pennsylvania’s Auditor General, Eugene DePasquale – Image powered by Post-gazette.com

He then used the market and consumer data of Washington and , the states where adult-use cannabis has been legalized for years, to estimate the annual spending of a single user.  DePasquale has estimated that every cannabis user would roughly spend $2,080 on legal pot every year, which adds up to $1.66 billion cannabis economy of the state.  

It is important to note that this figure just accounts for simple cannabis retail sales. Economic implications of external investments, favorable business opportunities, job creations and reduced law enforcement expenditures are not touched upon in the report.  

However, the cannabis economy envisaged by the Auditor General is highly taxed. He has suggested a total tax rate that lingers in between 35 and 37 percent. This includes 19 percent retail tax, 10 percent excise tax on production and 6 percent of state sales tax. DePasquale has also left the room for counties to impose 1 to 2 percent local taxes.  

Mayor of Pittsburgh, Pennsylvania, Bill Peduto
Mayor of Pittsburgh, Pennsylvania, Bill Peduto – Image powered by Newpittsburghcourieronline.com

So, a $1.66 Billion market taxed at the rate of 35 percent would bring more than half a billion in taxes. This money, according to DePasquale, can be used to fund various welfare projects in the state. Mayor of Pittsburgh, Pennsylvania, Bill Peduto is also rallying behind DePasquale to legalize adult-use cannabis.   

Peduto believes that the legalization of all forms of cannabis will eventually result in cutting down opioid use. Moreover, he is really convinced that it will spare the law enforcement bodies from the overwork of minor cannabis prosecutions. Peduto has given the examples of successful implementation of decriminalization in Pittsburgh and Philadelphia. It is worth mentioning that cannabis-related arrests have been reduced by half in Pittsburg. The city decriminalized the possession of less than one ounce of marijuana two years ago.  

The report furnished by DePasquale gives vibes similar to the recent report of New York’s Department of Health. Both these reports provide an encouraging insight into a legal cannabis environment. Mayor Peduto is hopeful that the state will soon take up the measure to legalize adult-use cannabis. He wants Pennsylvania to spearhead the trend of cannabis legalization in the region.  

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]


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