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ūüĆŅ Cannabis Tax Windfall for Illinois ūüĆŅ

ūüĆŅ Cannabis Tax Windfall for Illinois ūüĆŅ

 

Welcome back to our weekly newsletter, which outlines recent cannabis news you need to know about related to entrepreneurship, finance, legal, medicine, science, and technology.

Illinois gets a cannabis tax windfall in its first month of sales. The Vermont House passes a legalization bill. Clinical trials add further evidence for an antipsychotic potential of cannabidiol. We also take a look at how the coronavirus outbreak could affect the cannabis industry. 

Would you like to become a sponsor of our weekly Leaflet? Email me for more information.

Be sure to join us at a CannaGather in your city, where we continue to network and explore the latest progress in our communities as the reach of cannabis increases. 

Know someone who is just as cannacurious as you are? Be sure to share this newsletter to keep them in the loop!

// CannaGather Calendar

March 3 // Los Angeles, CA // Could CBD Lead to LA’s Cannabis Revival?

March 11 // New Haven, CT // Breaking Barriers: CTPharma’s Quest for Medical Cannabis to Meet American Expectations

March 12 // Baltimore, MD // Woman in the Weeds

March 16 // New York, NY // Venture Entrepreneurship & Investing

March 24 // Jersey City, NJ // CannaGather NJ March 2020

March 31 // Detroit, MI // CannaGather Detroit March 2020

March 31 // Denver, CO // Colorado’s Evolving Role in Cannabis Thought-Leadership

April 29 // Denver, CO // The State of the Industry

// Entrepreneurship

Coronavirus Impact on the Cannabis Industry

Global industries are feeling the effects of the coronavirus outbreak, and marijuana and hemp companies are likely to be impacted as well. The virus is spreading quickly through China and other Asian countries and has already landed in the U.S., Europe, and much of the world. 

How will this affect the cannabis industry? Experts predict a number of impacts, mostly caused by shutdowns of Chinese manufacturing plants that provide cheap cannabis hardware (especially for vaporizers, product packaging, and lab equipment). There will also be probable shortfalls of raw Chinese hemp material being exported to the U.S. and elsewhere. 

‚ÄúIt‚Äôs a huge wake-up call,‚Ä̬†said Nic Easley, CEO of Denver-based 3C Consulting. ‚ÄúIt‚Äôs forcing companies to look at their supply chain. ‚ÄėWhere do my products come from? Do I have multiple options for vendors?‚Äô¬†Everyone was looking for the cheapest option forever, and that‚Äôs China.‚ÄĚ

What this means and why you care: These impacts could cause difficulties for many entrepreneurs across the industry spectrum. But the current global climate could also create a void in the market for U.S. companies to fill.

// Finance

Cannabis Tax Windfall for Illinois

Cannabis sales in Illinois produced over $10 million in sales tax for the state in its inaugural month for their recreational market. The strong performance well surpassed expectations, and the Department of Revenue believes cannabis taxes will rise beyond the initial estimate of $28 million. Despite mass shortages from retailers over this period, sales reached about $40 million.

Over 70% of the taxes taken in were¬†‚Äúweed-specific‚ÄĚ while the remainder came from normal sales taxes also applied to marijuana products. Illinois estimates that fiscal 2021, which begins in July,¬†will pull in $127 million into the state. Tax rates at retail¬†vary based on the amount of THC in products and could fall in a range from 10-25% (with the additional sales tax, the average buyer paid 27%). By July, Illinois will also collect sales taxes from municipalities and counties (up to 3%), putting the state‚Äôs taxes somewhere between the rates of Washington¬†(37%) and Colorado (30%).¬†

What This Means and Why You Care:¬†Illinois plans to set a good example by sticking to social equity aspects of its cannabis program.¬†Roughly half of the ‚Äúweed-specific‚ÄĚ taxes are set to be reinvested in communities most effected by prohibition, as well as for mental health treatment and substance abuse.

// Legal

Vermont House Passes Legalization Bill

It’s official! On February 27, a bill to legalize marijuana sales was formally passed by the Vermont House of Representatives. While Vermont had already legalized the personal use possession and cultivation of marijuana back in 2018, the legislation at that time lacked a retail component. With this bill, consumers can now purchase cannabis, and though the House and Senate will have to come to an agreement on the process, the state can now set tax rates on legal sales.
 
According to a poll released by the Marijuana Policy Project in early February, Vermont residents have been largely in favor of the general reform movement (three-fourths of residents support the legalization and regulation of cannabis sales). This step will enable the establishment of a commercial cannabis market in Vermont and the creation of various categories of business licenses, protecting consumers while creating jobs and economic opportunities for small businesses. 
 
What this means and why you care: The Vermont House of Representatives officially passed a bill to legalize marijuana sales. This creates the potential for new jobs and economic opportunity for small businesses throughout the state. Keep an eye on the Vermont market!

// Medicine, Science, & Technology

Recent Medical Studies

A study found that ‚Äúadd-on THC:CBD oromucosal spray (nabiximols) consistently relieves resistant spasticity across subgroups‚Ä̬†and that ‚Äúpatients with moderate resistant [multiple sclerosis] spasticity benefit numerically from treatment; patients with severe resistant spasticity achieve significant therapeutic gains.‚Ä̬†

A review¬†‚Äúrecent clinical trials added further evidence for an¬†antipsychotic¬†potential¬†of cannabidiol.‚ÄĚ

Researchers discovered that ‚Äúthrough its favourable anti-oxidant and sodium channel inhibitory effects, CBD may protect against high-glucose induced¬†arrhythmia and cytotoxicity.‚ÄĚ

What This Means and Why You Care: Major studies around the United States continue to identify cannabis as a potential source for treatment for a variety of medical conditions. New opportunities for patients to benefit from cannabis will take form as studies are conducted and legalization expands.

// Community

CannaGather Takes On Albany and Detroit

CannaGather hosted an important event in Albany last week to help drive the conversation on legalization and ensure social equity components stay front and center. The exciting slate of speakers included Norman Birenbaum (Director of Cannabis Programs, Office of Governor Andrew Cuomo), Diane J. Savino (State Senator, District 23; Senate Sponsor, CCA), Walter Mosley (Assemblymember, District 57; Chair, BPHA Caucus Marijuana Task Force), Tremaine Wright (Assemblymember, District 56; Chair, BPHA Caucus), and Richard Gottfried (Assemblymember, District 75; Assembly Sponsor, CCA).

Missed out on all the fun? Check out the exclusive recap of our Albany event here.

CannaGather Detroit finished off February with a great event which featured James Fisher, Founder and Head of Cultivation at Canterra. James has been cultivating cannabis in Michigan for the past 10 years. After the passing of the Medical Marijuana Facilities Licensing Act (MMFLA) in 2016, James co-founded the Detroit-based vertically integrated company, Canterra. As the Head Cultivator for Canterra, James is responsible for the care and maintenance of 7,500 marijuana plants. Their cultivation facility in Beaverton, Michigan is home to over 20 strains of cannabis. These products and more will be available at Canterra’s line of dispensaries (New Standard) opening this month.

Would you like to become a sponsor of our weekly Leaflet? Email me for more information.

Do you want to join the CannaGather team? We would love to have you on board as we grow! You can email CannaGather founder Josh Weinstein at josh@cannagather.com for more info.

Written by Justin Bernstein

Contribution by Michela Proto

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