States where cannabis use is legal have seen substantial tax revenue generated, which can then be used for schools and health care needs.
Cultivation of marijuana plants can generate employment for farmers while simultaneously stimulating economies in areas that permit cultivation. Cultivation could also increase commercial real estate and construction jobs as demand rises for commercial real estate and construction jobs.
Tax Revenue
New Frontier Data’s study indicates that cannabis sales taxes provide a huge source of revenue in states that have legalized cannabis. These funds have already started strengthening local economies.
Taxes on products typically consist of a percentage of their price, levied at both state and local levels and collected by retailers. They may also combine with other taxes such as excise duties on certain goods such as cigarettes or fuel, for collection by retailers.
These taxes provide states with much-needed revenue as traditional sources have either stagnated or declined – for instance cigarette and fuel taxes have declined due to reduced consumption or shifts toward more fuel-efficient vehicles.
New Jobs
Cannabis legalization creates many new jobs across cultivation, retail and manufacturing sectors. According to Leafty’s estimates, marijuana production alone provides over 211,000 full-time jobs in America – more than coal mining or textile production combined. Unfortunately due to federally illegal status, however, traditional employment data sets don’t reflect this impact and multipliers like IMPLAN don’t allow for its inclusion.
Where cannabis is legalized, any extra fortune generated by the industry often gets reinvested back into communities as public services that aid residents impacted by drug prohibition and even expunge records for those convicted of marijuana-related charges. This cycle of reinvestment helps communities prosper while at the same time contributing to positive effects of legalized marijuana; additionally, jobs created by cannabis businesses provide income for workers who otherwise couldn’t find work due to physical or mental health constraints.
Health Benefits
Cannabis cultivation has seen significant expansion across states that have legalized its use, providing many economic and taxation benefits such as increased tax revenue, job creation, and economic development.
If New York were to adopt licensing similar to what exists for state alcohol industries, thousands of full-time equivalent workers (FTE) would likely be employed across cultivation, manufacturing and retail sectors based on estimates provided in three recent market research reports categorizing employment within the cannabis industry using NAICS codes for cultivators, manufacturers and dispensaries.
As the cannabis industry rapidly expands, so too do other industries that support it. Real estate and construction firms benefit from increased demand for properties related to cannabis use; food service firms also reap benefits of increased consumption; savings resulting from decreased costs related to enforcement of prohibition and criminal justice are another benefit of rapid expansion; this money could then be reinvested into programs that support community members.
Reduced Criminal Justice Costs
As more states legalize marijuana for medicinal and recreational use, a rapidly expanding industry is creating jobs and tax revenue in these regions – not only is this good for economies but it has numerous social advantages as well.
Legalizing marijuana would substantially decrease criminal justice costs. According to Jon Gettman, a PhD candidate in public policy from George Mason University, estimated that $10.7 billion could be saved annually in U.S. criminal justice costs if all marijuana prosecutions were discontinued.
Legalizing marijuana has the added advantage of decreasing racial disparities within the criminal justice system. Marijuana laws have had an uneven impact on minorities, particularly Black people who are more likely to be arrested than whites for possession. Since the War on Drugs began, this disparity has decreased slightly; however, legalization allows local communities to take charge of enforcement, freeing police departments to focus their energies elsewhere.