CHICAGO (WLS) — The state of Illinois is reporting record tax revenue on legal marijuana, with nearly half a billion dollars in the last year. Illinois consumers pay the second highest taxes in the nation when they buy legal recreational marijuana.
However, experts claim lowering taxes could mean more money for the organizations that benefit from those funds.
The state of Illinois made $445 million dollars in tax revenue from the sale of legal marijuana in the last fiscal year.
But where is that money going?
Much of it funds mental health, legal aid and housing programs in underserved communities. Bethany Little’s nonprofit, WIN Recovery, benefits from those taxes.
“To be able to get money back from marijuana taxes is bittersweet for a recovering addict like myself,” she said.
WIN Recovery provides shelter and support services for formerly incarcerated women and LGBTQ+ individuals.
“Sometimes you just need somebody to hold your hand to get through the process,” Little said.
WIN Recovery is now expanding that work thanks to taxes on legal pot.
The Illinois Prison Project, which fights for criminal justice reform, has also benefited from legal marijuana tax revenue.
Twenty five percent of Illinois’ pot tax goes to non-profit organizations with small budgets in communities designated as socioeconomically disadvantaged. Another 20% of the state’s marijuana tax revenue goes to substance abuse, prevention and mental health care programs.
The largest portion of the tax proceeds covers the state’s costs for administering the marijuana program and expunging minor cannabis offences.
To fuel all that, Illinois has the second highest recreational cannabis tax in the country, starting at 31.25%, which is only less than the state of Washington.
The I-Team found cannabis edibles for sale in Ann Arbor, Michigan for $14. That same product in Los Angeles sold for $23. And in Chicago consumers pay $30 for the same thing.
“The taxes could come down a little bit,” said legal cannabis consumer Alex Rosata.
Industry experts like Jeremy Unruh of Verilife Cannabis dispensary said when prices are high, consumers look elsewhere, like on the black market.
“It’s up to us, the operators as well as the regulators in the state, to ensure that the products we make have a price that’s competitive with the illicit market, because that’s the way we get rid of the illicit market,” Unruh said.
He and others say lowering the tax rate could also mean more sales and revenue for the state and, in turn, the programs that benefit from those tax dollars.
The I-Team asked researchers at legal cannabis data center New Frontier Data to compare Illinois’ tax rate and sales to other states. They said that cutting Illinois’ tax rate in half could win us more tax dollars.
“There’s that sweet spot in the middle of states that have tax rates between 16 and 18%,” said Dr. Amanda Reiman of New Frontier Data. “The tax rates have the capability of driving people into that unregulated space because they’re trying to save money.”
Little said every dollar counts. They’re using their cannabis state grant and to build a new 8,000 square foot resource center. It will provide people with counseling, training classes, family reunification and more.
“We have the ability to hold that person’s hand so they can be successful and be a productive member of society,” Little said.
Governor JB Pritzker’s office responded to criticism of the state’s tax rate saying in the last year, Illinois has seen a 50% increase in total tax reported from adult-use cannabis. They added that the state has increased revenue each year since legalization and that it’s using that revenue for communities in need.
Copyright © 2022 WLS-TV. All Rights Reserved.
Ino Saves New
via rk2’s favorite articles on Inoreader https://ift.tt/JA1798U
November 19, 2022 at 08:03AM