November 2014

Washington State: Lower Prices on the Way?

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Washington state’s poorly designed marijuana laws have resulted in slow retail growth and high prices. One of the biggest failures of current legislation is disallowing existing medical marijuana dispensaries from selling recreational marijuana. For example in Seattle there are almost 200 medical marijuana suppliers but only a half dozen shops that sell recreational marijuana.  Another problem is pricing.  With a 25% tax added to the cannabis product at every stage (production, processing and retail sales) recreational pot costs twice as much as medical marijuana. This price descrepancy is allowing the perpetuation of the black market and hindering tax revenues for the state.  When Oregon pot shops open in 2016 the pot shops on Washington’s border will become obsolete and will likely be forced out of business.

This situation could be remedied if new proposed legislation is passed.  Sen. Jeanne Kohl-Welles (D-Seattle) has proposed a bill that would:

1) Raise the limit on  the number of state-licenses (currently 21 for Seattle and 334 statewide) and allow medical dispensaries to apply to sell recreational pot.

2) Reduce marijuana taxes by consolidating the three step tax into a single levy collected at the recreational pot shops.

3) Reduce restrictions on store locations

4) Share tax revenues only with those cities and counties that allow industry to function in their area.

 

 

 

 

 

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