The state of New York expects to rake in more than a whopping $1.25 billion in cannabis tax revenue over the next six years, according to Marijuana Moment. The massive estimate in cannabis revenues was included and revealed in Governor Kathy Hochul’s executive budget released last January 18, 2022.
As the fiscal spending plan for 2023 was unveiled, it seems that New York is only starting to reach new heights with the help of marijuana legalization in the state.
According to the New York Post, most of these amounts will come in the later years as the legal marijuana landscape takes off in New York. The news site state that revenues for this field are slated to reach around $363 million for 2028 alone.
While the said projected cannabis revenue in 2028 is relatively high, the first years of legal marijuana sales and regulation can expect to see fewer revenues. In fact, the first year of sales is expected to bring in only around $56 million, reveals the New York Post. Of this amount, $40 million will come mainly from the licensing fees from growers and sellers who wish to participate in the legal marijuana landscape of New York.
Although the marijuana revenue may start out small in 2023, this number is only expected to climb over time. Marijuana Moment reports that by 2024, the state targets bringing in $95 million. Meanwhile, by 2025, this number is expected to grow to $158 million, $245 million by 2026, and $339 million in 2027.
With the state revenues obtained from the marijuana industry, Marijuana Moment states that a portion of these will be allocated to certain communities and sectors. 40% of this revenue will be given to education, another 40% will be allocated to community reinvestment, and the remaining 20% will be allocated for drug treatment and rehabilitation.
On top of this, Marijuana Moment states that another 4% tax will be distributed to participating counties, cities, towns, and villages that allow cannabis businesses to operate within their area.
“We have the means to immediately respond to the COVID-19 pandemic as well as embrace this once-in-a-generation opportunity for the future with a historic level of funding that is both socially responsible and fiscally prudent,” announced Governor Hochul in her budget plan.
Apart from unveiling this plan in the budget book, the governor also proposed a $200-million fund designed to support individuals and applicants seeking to enter and join the cannabis landscape. This will reportedly be funded through a private and public partnership.
With the marijuana legalization program still underway, the New York Post notes that New York’s Office of Cannabis Management aims to give around 50% of state licenses to social and economic equity applicants.
Sales and regulatory observances in the state still have a long way to go. However, in a statement, spokesman for the Cannabis Management Office of New York Freeman Klopott said they are working “as fast as possible while also making sure we do it the right way and create equitable opportunity where other states have failed.”
As of writing, adults aged 21 and over are now allowed to possess and consume cannabis, provided that cannabis is only consumed where tobacco smoking is allowed as well.