Pubdate: Thu, 19 Jul 2018
Source: Philadelphia Daily News (PA)
Copyright: 2018 Philadelphia Newspapers Inc.
Author: Sam Wood



Legalizing marijuana for adult recreational use in Pennsylvania could
generate more than $580 million in tax revenue for the state, said
Auditor General Eugene DePasquale in a report issued Thursday morning.

"Pennsylvania's budget challenges are now a consistent factor in all
state policy decisions," said DePasquale. "Taxing marijuana offers a
rare glimmer of fiscal hope, providing a way to refocus the state
budget process away from filling its own gaps."

Last year, the state faced a shortfall of more than $2 billion.

DePasquale proposes levying a 35 percent tax on any recreational
marijuana that would be sold in state-sanctioned retail stores.

Pennsylvania's medical marijuana program launched in February and
serves about 28,000 eligible patients. But neither Gov. Wolf, a
Democrat, nor the Republican-controlled state legislature appear ready
to support adult recreational use.

Nine states and Washington D.C. have legalized marijuana for adult use
though the federal government still considers it to be a Schedule 1
substance on par with heroin and LSD.

DePasquale's report assumes that nearly 800,000 Pennsylvanians consume
cannabis every month and spend a little more than $2,000 a year on
their weed. Based on those numbers, the current underground marijuana
economy generates about $1.6 billion each year.

DePasquale said Philadelphia, given its status as a tourist
destination, could reap an additional $6.9 million if it imposed a 2
percent local tax on legal marijuana sales.

Marijuana advocates, however, warn that DePasquale may be overreaching.

"Those estimates assume that Pennsylvania would be able to capture the
entire underground market overnight," said Chris Goldstein, a cannabis
advocate who has taught a course on marijuana and journalism at Temple
University and written for "No state that has legalized
marijuana has been able to get all its consumers to participate in the
regulated market."

Goldstein said that's because state-regulated marijuana is often
exorbitantly priced when compared with illegal weed.

In Colorado last year, legal marijuana generated $247 million in
taxes, licenses and fees. Pennsylvania's population is twice that of

DePasquale's numbers pale in comparison to revenue estimates prepared
last year for St. Sen. Daylin Leach (D., Montgomery). Leach, who has
introduced several cannabis legalization bills in Harrisburg, believes
that adult use marijuana could pour $1.5 billion in taxes into state
coffers after four years.

"It's a very substantial amount of money for the state," Leach said
"And that doesn't take into account the money saved by not having to
arrest, prosecute and incarcerate people for those crimes."