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Medical marijuana could be a lucrative business bonanza for pot entrepreneurs in Massachusetts next year, but the state and municipal tax collectors won't see much of that money.
That's because the ballot measure that passed earlier this month sets up the 35 permitted dispensaries as nonprofit corporations, exempt from state and municipal taxes. And pot, once it is deemed medicine, would also be tax-free.
"It's unclear it's going to lead to very much tax revenue because there aren't any provisions for that," said Harvard University economist Jeffrey Miron. "Certainly you can charge someone a fee to open a dispensary. But we're not talking tens of millions of dollars."
Massachusetts patients also won't pay sales tax for medical marijuana under an exemption for prescription drugs, said Department of Revenue spokeswoman Ann Dufresne. It means state revenue may be largely limited to pot-related income taxes.
In contrast, Colorado's for-profit $155-million-a-year medical marijuana trade generates millions in state and local taxes. California's multimillion-dollar pot dispensaries are set up as nonprofits, but buyers still pay sales taxes, said Aaron Smith of the National Cannabis Industry Association.
And the jury is out on whether medical pot will provide Massachusetts with long-term economic growth – although some businesses may strike it rich at first, Miron said. "They're not really new businesses. It's just being brought above ground. It's like when the alcohol trade was relegalized in the U.S. in the 1930s, a lot of people who were selling moonshine just went back to doing business out in the open."
News Hawk- TruthSeekr420 420 MAGAZINE
Source: bostonherald.com
Author: Erin Smith
That's because the ballot measure that passed earlier this month sets up the 35 permitted dispensaries as nonprofit corporations, exempt from state and municipal taxes. And pot, once it is deemed medicine, would also be tax-free.
"It's unclear it's going to lead to very much tax revenue because there aren't any provisions for that," said Harvard University economist Jeffrey Miron. "Certainly you can charge someone a fee to open a dispensary. But we're not talking tens of millions of dollars."
Massachusetts patients also won't pay sales tax for medical marijuana under an exemption for prescription drugs, said Department of Revenue spokeswoman Ann Dufresne. It means state revenue may be largely limited to pot-related income taxes.
In contrast, Colorado's for-profit $155-million-a-year medical marijuana trade generates millions in state and local taxes. California's multimillion-dollar pot dispensaries are set up as nonprofits, but buyers still pay sales taxes, said Aaron Smith of the National Cannabis Industry Association.
And the jury is out on whether medical pot will provide Massachusetts with long-term economic growth – although some businesses may strike it rich at first, Miron said. "They're not really new businesses. It's just being brought above ground. It's like when the alcohol trade was relegalized in the U.S. in the 1930s, a lot of people who were selling moonshine just went back to doing business out in the open."
News Hawk- TruthSeekr420 420 MAGAZINE
Source: bostonherald.com
Author: Erin Smith
