mLive reports that the implications of federal marijuana legalization has some industry experts worried:
“Opening up interstate commerce would destroy Michigan’s cannabis industry and leave us with nothing but multi-state operators to purchase from,” said Rick Thompson, a Michigan cannabis pioneer and director of the Michigan chapter of the National Organization for the Reform of Marijuana Laws (NORML).
Thompson said everyone he knows “stands in opposition to at least some of the” current version of the proposed federal legalization plan.
Some of the worry centers on marijuana surpluses in Canada and other states, like Oregon, where producers would benefit greatly from the ability to dump cheap product into the Michigan market, undercutting existing businesses along the way.
The topic of federal legalization was the focus of a panel discussion at the National Cannabis Industry Association Midwest conference at the TCF Center in Detroit on Wednesday. The National Cannabis Industry Association is a trade organization and lobbying group that is weighing in on efforts to end federal prohibition of marijuana.
In a draft of federal legalization legislation released in July by Democratic U.S. Senators Chuck Schumer of New York; Corey Booker of New Jersey; and Ron Wyden of Oregon, entitled the Cannabis Administration and Opportunity Act, there is a proposed 25% federal excise tax for marijuana in the fourth year after legalization. That’s on top of existing state taxes, currently at 16% for recreational marijuana in Michigan.
…If significant new federal taxes are imposed, “the black market will have a party like you have never seen before,” Thompson said. “It was nearly impossible to eliminate illegal cannabis sales when there was no tax; it is impossible to eliminate unlicensed sales with a 10% tax rate; and if the tax climbs to 35% or higher, the regulated market will shrink rapidly as people return to their unlicensed cannabis sources forever.”
photo via Pincanna Instagram