Why not just heavily tax marijuana? That seems like a more reasonable and targeted way to raise money from this change.
when we said "regulate and tax it" for decades, we didn't mean give the blackmarket a greater marketshare by making the taxes exorbitant.
People are going to buy weed, if the taxes make it not worth purchasing legally the blackmarket will always be there to undercut it.
you have to COMPETE with blackmarket prices, you can't just jack up prices, legalize it and then expect people to stop paying $25 for 3.5 grams of top-tier marijuana.
no one is going to continually pay $75 for 3.5 grams, especially after the novelty has worn off.
If you have a who buddy will sell you the same amount of equal or higher quality for a 1/3rd of the price, would you pay 2/3rds more?
If cities add more tax on top of state tax, then it'll push more medical and recreational users right back into the untaxed newly formed gray market. Same with cities who don't open shops.
I think this is a result of being blinded by dollar signs instead of practical and thought-through policy.
Yes, it'll still rake in tax dollars and yes, people who don't know any better will buy from shops, like tourists.
But for the target market? I'm not so sure.
But for your regular person who's made due without a legal marijuana distribution network isn't going to start paying a premium on the regular for the privilege of retail. It's mostly a novelty, IMO, and may increase graymarket demand for untaxed marijuana for everyone BUT the people looking to do some weed tourism, etc.
I don't know about the US, but in Australia where cigarettes are heavily taxed (one packet of cigarettes can go for AUD$30) there's a small but pretty active market for imported untaxed cigarettes.
1. Home cultivation is legal (and not controlled by local officials), and therefore the "black" market is booming / prices are dropping.
2. Municipalities are blocking recreational cannabis businesses, in many cases instituting "moratoriums" for 1-2 years to "allow the state legal framework to be hammered out" (which is complete BS) This helps the black market further.
3. Furthermore, the shops that are allowed are heavily regulated and taxed, further helping the black market price advantage.
Until recreational cannabis businesses are open and thriving, the black market will continue to surge, and probably hasn't even peaked.