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Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

fivethirtyeight.com

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Re: Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

#11

Post by ryanlol »

wils1245 wrote: post #5
stevenwoo wrote: post #4

Earlier quoted context omitted.

Those taxes on weed don't look bad compared to what I think is the current equivalent product with even higher taxes - cigarettes - how is the situation different in your view?

There’s a much more robust black market already in place for marijuana than for cigarettes. Washington has all the same products and is right next door, and taxes at 3% [1]. Also at least in CA municipalities are adding their own taxes, so the distance you need to travel to enable black market arbitrage might not be much. 1 - https://dor.wa.gov/sites/default/files/legacy/Docs/Reports/2...

>There’s a much more robust black market already in place for marijuana than for cigarettes

Dunno, it's easier to order black market cigarettes online with a credit card than to order black market marijuana.

Re: Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

#13

Post by nitwit005 »

wils1245 wrote: post #5
stevenwoo wrote: post #4

Earlier quoted context omitted.

Those taxes on weed don't look bad compared to what I think is the current equivalent product with even higher taxes - cigarettes - how is the situation different in your view?

There’s a much more robust black market already in place for marijuana than for cigarettes. Washington has all the same products and is right next door, and taxes at 3% [1]. Also at least in CA municipalities are adding their own taxes, so the distance you need to travel to enable black market arbitrage might not be much. 1 - https://dor.wa.gov/sites/default/files/legacy/Docs/Reports/2...

There seems to be no shortage of prosecutions for people smuggling cigarettes, or avoiding the taxes.

Re: Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

#14

Post by rconti »

wils1245 wrote: post #3

Two things of interest that the article doesn’t go into: - Taxes on weed in CA are going to be very high, ~20%. This may drive black market sales. - Online ordering through Eaze is popular, which might drive the familiar winner take all online commerce market dynamic. A lot of people don’t care for the dispensary experience. At the end of the day, this is an agricultural product, and a commodity. It was optimisticall…

The taxes won't be an issue. They'll easily be swamped by lowered costs, eventually.

One major issue is retail store licenses; few cities are deciding to license stores, and they're not happening on day 1 (for the most part).

Another issue is licenses for growers. Currently growing licenses only allow 1 acre under cultivation, and it sounds like production will be nowhere near high enough to meet demand, at least initially.

It sounds like CA's start into the legal market will be a lot rockier than most.

Re: Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

#15

Post by headstorm »

wils1245 wrote: post #5
stevenwoo wrote: post #4

Earlier quoted context omitted.

Those taxes on weed don't look bad compared to what I think is the current equivalent product with even higher taxes - cigarettes - how is the situation different in your view?

There’s a much more robust black market already in place for marijuana than for cigarettes. Washington has all the same products and is right next door, and taxes at 3% [1]. Also at least in CA municipalities are adding their own taxes, so the distance you need to travel to enable black market arbitrage might not be much. 1 - https://dor.wa.gov/sites/default/files/legacy/Docs/Reports/2...

Your link shows the weighted local sales tax rate at 3%. The state sales tax is 6.5%, reflected under 'Estimated state sales tax collections'.

The state excise tax (pre-sales tax) is 37% according to https://lcb.wa.gov/mj2015/faqs-on-taxes .

Re: Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

#16

Post by Synaesthesia »

pravda wrote: post #12

Holy guacamole those weed prices are off the scales! $7.50 a gram? Weed should cost about the same amount as catnip. I can buy 4 oz of catnip for $8 on eBay. That's over 100g, about 8 cents a gram.

It should maybe but it doesn’t.

Re: Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

#17

Post by aphextron »

wils1245 wrote: post #3

Two things of interest that the article doesn’t go into: - Taxes on weed in CA are going to be very high, ~20%. This may drive black market sales. - Online ordering through Eaze is popular, which might drive the familiar winner take all online commerce market dynamic. A lot of people don’t care for the dispensary experience. At the end of the day, this is an agricultural product, and a commodity. It was optimisticall…

>Online ordering through Eaze is popular, which might drive the familiar winner take all online commerce market dynamic. A lot of people don’t care for the dispensary experience.

Anecdotally, I've seen a ton of small delivery services popping up in the Bay Area recently and doing well. Turns out selling weed is profitable.

Re: Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

#18

Post by AndrewUnmuted »

wils1245 wrote: post #3

Two things of interest that the article doesn’t go into: - Taxes on weed in CA are going to be very high, ~20%. This may drive black market sales. - Online ordering through Eaze is popular, which might drive the familiar winner take all online commerce market dynamic. A lot of people don’t care for the dispensary experience. At the end of the day, this is an agricultural product, and a commodity. It was optimisticall…

> Some heavy users care about certain strains and the like, but I have a feeling that for most people weed is weed.

As recently as 5-6 years ago, I would have agreed with this sentiment. These days, however I think this mentality is no longer a responsible one to propagate.

Today's cannabis is, in general, much more potent than it used to be. And now there are ways to consume very large amounts of this extremely potent product in a very short amount of time (concentrates, oils, edibles, etc). No matter how it's consumed, today's average cannabis user is getting a lot more in their hit than prior generations. This means that the difference between a sativa and indica is no longer necessarily a nuanced one.

Today people need to be reasonably sure that what they're getting will meet their needs, because for some one hit may send them spiraling in the totally wrong direction. A user with anxiety issues may need to entirely steer clear of sativas because they are known to cause anxiety attacks. But someone who needs to be around other people may need to avoid indicas because they are known to cause delayed responses and decreased social acumen.

This risk is compounded when people use one of these new, super-powerful 'hybrid' strains because their effects on the individual user are harder to predict than pure indica or sativa strains.

Legalization will put new emphasis on educating users on safe practices, harm reduction, and other such things. In the US, public schools teach harm reduction strategies with alcohol in its various forms, and one day it will probably need to do the same for cannabis.

Re: Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

#19

Post by AndrewUnmuted »

mikestew wrote: post #6
wils1245 wrote: post #3

Two things of interest that the article doesn’t go into: - Taxes on weed in CA are going to be very high, ~20%. This may drive black market sales. - Online ordering through Eaze is popular, which might drive the familiar winner take all online commerce market dynamic. A lot of people don’t care for the dispensary experience. At the end of the day, this is an agricultural product, and a commodity. It was optimisticall…

Taxes on weed in CA are going to be very high, ~20%. This may drive black market sales. WA’s taxes are ungodly high for weed (EDIT: w/o looking it up, more than 20%, that’s for sure). Didn’t seem to slow down things much. A new store just opened closer to the house, and I don’t know of a single store that has closed. Personally, I’m more than willing to pay the “convenience fee” to just drive down the road any time I…

> As for online ordering, yeah, that’s going to be a thing.

If the Darknet is any indication (and according to High Times[0], it is), you're right about this. Cannabis is the most popular product sold on the various illicit online drug marketplaces.

[0] https://hightimes.com/business/marijuana-is-the-most-popular...

Re: Legal Marijuana Isn’t the Boon Small Businesses Thought It Would Be

#20

Post by root_axis »

AndrewUnmuted wrote: post #18
wils1245 wrote: post #3

Two things of interest that the article doesn’t go into: - Taxes on weed in CA are going to be very high, ~20%. This may drive black market sales. - Online ordering through Eaze is popular, which might drive the familiar winner take all online commerce market dynamic. A lot of people don’t care for the dispensary experience. At the end of the day, this is an agricultural product, and a commodity. It was optimisticall…

> Some heavy users care about certain strains and the like, but I have a feeling that for most people weed is weed. As recently as 5-6 years ago, I would have agreed with this sentiment. These days, however I think this mentality is no longer a responsible one to propagate. Today's cannabis is, in general, much more potent than it used to be. And now there are ways to consume very large amounts of this extremely pote…

> Today people need to be reasonably sure that what they're getting will meet their needs, because for some one hit may send them spiraling in the totally wrong direction. A user with anxiety issues may need to entirely steer clear of sativas because they are known to cause anxiety attacks. But someone who needs to be around other people may need to avoid indicas because they are known to cause delayed responses and decreased social acumen.

What's the source for this, I'm genuinely interested? As far as I'm aware, this is more a marijuana folklore thing than an effect that science has verified.

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