Nevada's marijuana industry cheers governor's tax proposal


    Solutions Recovery describes signs parents should look for when it comes to drug and marijuana use (KSNV file)

    How many industries says getting taxed is a good thing?

    Nevada’s marijuana industry sees the Governor’s proposal to levy an excise tax on the sale of recreational marijuana as more evidence it is a player, with a seat at the table.

    “He was not for this, he campaigned against it, and I was really impressed,” said Joe Brezny, who helped pass Question Two in November. The measure, which makes recreational marijuana legal, passed by a not-so-slim ten point margin.

    The Governor’s proposed $8.1 billion dollar budget contains no new taxes – except one: a 10% excise tax on the sale of recreational pot. The Governor has earmarked the money to go exclusively to schools, which he estimates could see $70 million dollars from marijuana. That, combined with Question Two’s 15% wholesale tax on marijuana, brings the recreational boost to almost $100 million dollars.

    “This is a revenue source that has been ignored. It’s been driven into the black market, and so the whole point of this was to produce enough revenue for schools that it makes a difference, but not have the tax burden so high that it enables the black market,” said Brezny.

    Marijuana is already part of our education funding. The two percent tax on medical marijuana you pay at a dispensary has already sent Nevada schools more than 1.1-million- dollars, which is just fine with customer Vanita Humphrey.

    “I'd rather some of my tax money go to schools,” she told me, as she shopped at the Source Dispensary on Rainbow.

    The Governor's recreational pot plan puts us right in the ballpark with other recreational marijuana states, says marijuana advocates.

    “That still puts us around the tax burdens they have in Colorado,” said Question Two’s Brezny. “If you look at what they did in Washington, they put a 75 percent tax on at first, and it really enabled the black market - the black market didn't go away.”

    And that's the rub: tax too much, and illegal sales blossom. In Colorado, the pot excise tax is 15 percent, and the legal recreational pot business there is thriving. Legal pot sales there both medical and recreational jumped 42 percent last year, to almost a billion dollars.

    That gets a politician's attention. This today, from Nevada's incoming assembly speaker, Democrat Jason Frierson.

    "Using these tax revenues to fund education is not only the smart thing to do - it's what the people want," he told me in the statement.

    The wild card is the incoming Trump Administration. Attorney General Designate Jeff Session is no fan of pot.

    Will Washington crack down?

    “For the purposes of this new administration it's a wait and see attitude,” said Scot Rutledge, with the Nevada Cannabis Coalition.

    “I think if we do things the way we're supposed to do them in Nevada, and do this in a highly regulated fashion, we're not going to run afoul of the federal government,” he says.

    The Governor’s proposed tax must wind its way through the legislative session, which begins on February 6th. In addition to the tax, the Governor is also establishing a task force to implement Question Two.

    Marijuana proponents hope to have recreational sales in place in Nevada by this summer.

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