Congressional Research Service: Cannabis Would Fall to Under $20 an Ounce if Legalized Nationwide

Congressional Research Service: Cannabis Would Fall to Under $20 an Ounce if Legalized Nationwide

The Congressional Research Service (CRS) has released a thirtycrs five-page report examining the effects of the federal government implementing a wholesale excise tax on the production and sale of cannabis and cannabis-related products.

CRS’ analysis indicates that cannabis prices would fall to as low as $5 to $18 an ounce under a legalization model; they claim that today’s average prices of $200 to $300 an ounce are inflated due to prohibition. The report found that if cannabis were taxed at $50 an ounce, the nation would generate over $7 billion in taxes from an estimated $40 billion legal cannabis market.

“This CRS report on the prospects of the federal government taxing and regulating cannabis is another clear indication of the political saliency and fiscal appeal of ending cannabis prohibition at the state, and increasingly at the federal level (replacing the nearly eighty-year old failed federal policy with tax-n-regulate policies that are similar to alcohol and tobacco products)”, says Allen St. Pierre, Executive Director of NORML.

He continues; “With fours states and the District of Columbia since 2012 opting for legalizing cannabis, dozens of members of Congress from both major political parties—from states with legalization and those that pine for it—are getting serious about making sure the federal government does not lose out on hundreds of millions annually in tax revenue from the ever-growing cannabis industry in the United States.”

The full report can be found by clicking here.

TheJointBlog

6 Comments

  • Anonymous
    November 25, 2014

    Ha, this is dumb. It will never be that cheap. I hope it stays illegal so i can make my money

  • Anonymous
    November 25, 2014

    $20 for an OZ, the price will cut everyones throat where I am

  • Rick
    November 25, 2014

    They have no IDEA

  • Sean
    November 25, 2014

    Hey Anonymous: special place in hell for you. You don’t give a damn about people going to jail as long as you can make a buck, scumbag.

  • RMForbes
    November 25, 2014

    Yes, there may be some ditch weed or a grower’s mistake/damaged/mildewed product that might sell for prices as low as $20 an ounce but the higher quality cannabis products will always sell far better. However, that crap will only end up in the illicit market, they will not make it into the legal market at all. No legal retailer would touch it.

    I think now is the time for cannabis growers and hemp product producers to band together in local associations and CO-OPs to take advantage we now have as long as we have the State by State legalization process protecting us from transnational corporate takeover. Once the federal government relents and removes cannabis from Schedule I the corporations will move in and seek to monopolize the market. We need to create a strong local and State infrastructure before this happens.

  • Anonymous
    November 28, 2014

    I agree RMForbes, you are right. I have thought about that myself. I am in Oregon and will be a wholesaler once the laws go into effect. I dont think prices will get as low as some estimate, but I already see it in states that have legalized marijuana. Prices can be as much as 50% lower then states that are not legalized at this time. So, I think you could take those small numbers, and that is what your PROFIT will look like per ounce after all the taxes and fees (should the feds drop the Marijuana from Schedule 1. . A co-op is what growers need, just as they did with veg farmers and such. This would give all growers power to legislate and represent our industry. Otherwise who do you think will own it all. ? I won’t say, but trust, me with the amount of money to be made in this industry at this time, they want their share.

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