On January 1st, recreational marijuana will become legal in California. But it's not as simple as switching your the label on marijuana from "medical" to recreational. There are new laws and regulations governing the industry that will change how things play out. And one of the things that will change is cost.
With the new laws taking effect, there will also be new taxes added to recreational marijuana purchases made throughout the state. So while marijuana will be legal, it will be more expensive than it was if you had a medical ID card. But how much more expensive will it be?
The folks over at Green State did some analysis and they compared the prices of marijuana right now versus what they will be on January 1st in cities throughout California. Here is how much $50 worth of marijuana will cost in some of these cities.
Today: $53.88 ($50 pre-tax price + $3.88 state and local sales tax)
January 1st: $61.93 ($50 base price + $3.88 state and local sales tax + $6.90 state excise tax + $1.15 state cultivation tax)
Today: $54.63 ($50 pre-tax price + $4.63 state and local sales tax)
January 1st: $65.18 ($50 pre-tax price + $4.63 state and local sales tax + $2.50 Oakland excise tax + $6.90 state excise tax + $1.15 state cultivation tax)
Today: $50 ($45.98 pre-tax price + $3.79 state and local sales tax + 23 cents local use tax)
January 1st: $58.05 ($45.98 pre-tax price + $3.79 state and local sales tax + 23 cents local use tax + $6.90 state excise tax + $1.15 state cultivation tax)
As you can see, all recreational marijuana purchases will include a state excise and cultivation tax that will increase the price of marijuana slightly. These aren't huge differences, usually less than $10, but over time that would add up quite a bit.
And as you can see in Oakland, many cities will also be including their own recreational marijuana taxes as well. Some have speculated that people may avoid those cities and purchase their cannabis in areas without additional taxes. Others wonder if people will continue to stay in California's medical marijuana program in order to pay lower prices.
But if you're a resident of California, be prepared to pay a little extra on your first visit to a dispensary in 2018.
(h/t Green State)