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Comment by IMTDb | Hacker News Reader

$15B combined since legalisation started; and revenues are dipping.

For reference; Alcohol generates roughly $10B per year (https://www.statista.com/statistics/248952/revenues-from-alc...). Tobacco as well (https://www.statista.com/statistics/248964/revenues-from-tob...)

I was not able to find reputable sources for Cannabis; the numbers in the article are coming from "Marijuana Policy Project", which makes them highly suspicious since the stated goal of the organisation is: (form their own website): "The Marijuana Policy Project (MPP) is the number one organization in the U.S. dedicated to legalizing cannabis". So they would likely use any calculations methods that would paint cannabis in a good way.

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How are the savings from not wasting the time of the police, and not putting people in prison?

Probably not very high.

I know a lot of people who sell hard drugs and get caught selling said drugs. They spend a night in jail, bail out and go on probation where they can time the ankle monitor to know exactly when they have to stop drinking at parties

I’ve seen people drive kilos of coke across the country for years without being caught or having any worry

I’m all for weed but the idea that we’re locking people up in prisons for smoking a joint is very misguided compared to what the legal system really behaves like

Any arrest or criminal record also reduces your future earning potential significantly and hence your tax value to the state. In some studies it can be mid-20%-ish.

Drug convictions or even arrests make you ineligible to enter many other countries, make it very difficult to travel, and make it difficult to get a job.

You don't have to end up in prison to waste the state's money and to materially impact your life and productivity.

Legalization started with two small states; it currently generates $3.75B/year in states representing about a third of the country. Notably, New York legalized sales on December 29, 2022, which was too late to generate significant tax revenue; Virginia legalized possession in 2021 but has never legalized sales; NJ legalized in April, NM in April, RI in December, CT in January '23, MO in February '23. So a big chunk of the legal market didn't have a full year of sales last year.

>"The Marijuana Policy Project (MPP) is the number one organization in the U.S. dedicated to legalizing cannabis". So they would likely use any calculations methods that would paint cannabis in a good way.

You can find similar numbers with details from the Motley Fool:

https://www.fool.com/research/marijuana-tax-revenue-by-state...

Also, it's questionable whether high usage rates would paint the most optimistic picture of cannabis legalization. If sales are low, then that makes the case for legalization stronger, not weaker, I would think.

It’s probably not a net gain though (I guess?). Money not spent on weed would probably be spent on something else and taxed, unless we’re assuming nearly all money spent on legal weed would have been spent on illegal weed (maybe true??)

My state (Oregon) has no sales tax, but does have a 20% tax on recreational cannabis, so in our case the cannabis tax revenue would be a net gain for the state.

Typically, tax rates are much higher on cannabis than regular sales tax. In many states, it is even taxed twice; once when the retailer purchases it from a distributor, and again when the consumer purchases it from the retailer. Some laws have changed, but, in prior years, this could lead to an effective tax rate of around 40% in states like California.

> It’s probably not a net gain though

Relative to what? If weed was still illegal and untaxed, there are additional policing costs not taken into account here. If you mean relative to a world where nobody wanted to do drugs, then sure, but that's fantasy.

> and revenues are dipping

Revenues dipped between 2021 and 2022 and were rising before that.

Also it's only from 14 states, other states will start collecting taxes this or in following years.

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