TAX NEWS - JUNE 2010

California Tax: With $1.4 Billion in Cannabis Tax Revenue, California Could Help Millions

Faced with one of its worst budget crises in years, the state of California must cut many important services and contemplate raising taxes and imposing new fees. Legalizing, regulating and taxing cannabis is a huge potential source of state revenue.

According to California's State Board of Equalization, the revenue from legalizing and taxing cannabis should net the state roughly $1.4 billion annually. While a cannabis tax alone would not solve the budget crisis, it would help.

California state budget is a zero-sum game and services need to be funded. By failing to legalize and tax cannabis, the state is choosing to bypass potential revenue. Seen another way, to keep cannabis illegal, the state needs to cut $1.4 billion in needed public services or increase other taxes by $1.4 billion.