A new government report is out in Australia involving projections of potential tax revenue if/when national adult-use cannabis legalization becomes a reality in the country. Adult-use is currently illegal in most areas of Australia, with a notable exception being the Australian Capital Territory where some legal protections for consumers exist.
Cannabis commerce, including medical cannabis commerce, is very restrictive in Australia. Most of the country’s medical cannabis industry activity currently revolves around pharmaceutical products and research.
Australia ‘s Parliamentary Budget Office recently released a report that presents two options for legalizing adult-use cannabis in Australia. Part of the report also includes projections for possible industry tax revenue. Per Newsfeed:
According to the PBO report , the first option calls for the creation of the Cannabis National Agency (CANA), which would act as the sole wholesaler between growers and retailers, set wholesale cannabis prices and issue licenses to potential cannabis owners. cannabis companies. Ideally, the agency would be funded entirely by production and retail licensing.
This option would legalize cannabis for anyone aged 18 and over, with no restrictions on how much a person can buy. This approach would also create penalties for selling to underage people, as with alcohol. Cannabis would be available to “overseas visitors”, and residents would be allowed to grow up to six plants. Finally, recreational sales would be “subject to the Goods and Services Tax (GST) as well as a 25% excise duty on sales including the GST”.
The second option contains all the provisions of the first option, except for the final recommendation, which would increase the excise tax to 15% instead of 25%.
The report estimates that legalization would generate as much as A$28 billion in the first ten years after a regulated adult-use industry was launched. It’s worth noting that the projected figure is largely based on a snapshot in time.
As the global cannabis industry continues to evolve and the landscape shifts, the profit potential for companies and governments will shift with it. That is true in Australia just as it is true everywhere else around the world.
It’s unclear at this time what the chances are of either option listed in the government report actually becoming law, but it is encouraging to see that multiple options are being considered, and that the information is from a government entity. (Full Story)