New York has yet to roll out their “rules and regulations” for people interested in applying to get dispensary licenses. Kathy Hochul believes that NY State will collect $1.25B in tax revenue over the next six years. The Federal Government could generate $12B. These are huge numbers.
There are a few issues here. The biggest one is how cannabis is taxed. Considering cannabis has been illegal for decades through a false narrative, it makes zero sense that it is now being taxed so that any dispensary operator can not be profitable. The only entity that will benefit is the Federal Government overtaxing a brand new industry. Keep in mind the legal dispensary owners are competing with an illegal market that does not pay taxes which means the cost per product is dramatically lower. What is the point of that? Has anyone in Government thought this through?
Cannabis should be taxed just like alcohol, although it is a wellness product if you read all the data coming from cannabis research. Americans are now consuming fewer pharmaceutical products with access to cannabis.
I plan on applying for a cannabis dispensary license when the time comes. If we get the licenses, our stores will have profit sharing for all, and we are committed to hiring people from NYCHA and those who have been incarcerated. We have a social mission that is extremely important to us. We want to give 10-20% of the EBITDA back to organizations such as Strive and Medgar Evers that impact those hurt by the war on drugs with programs and education. How can we do that if the Federal Government makes it impossible for us to be profitable?
NY State and the Federal Government would be well served to talk to the experts who have been involved since day one in other states, or NY will look like California, which is a mess. Most experts in this space care deeply about social equity, and their frustration with how the Federal Government has rolled out the taxes angers everyone. If the Federal Government doesn’t change the tax laws so we can make money and give back or just turn a profit, the opportunity for everyone to prosper from a new industry will fall into an abyss.