Many tourists that travel to Las Vegas still aren’t aware that cannabis is now legal for purchase and recreational use. However, since the July 1st, 2017 start date, many who follow the cannabis industry were watching closely at Nevada’s movement from a financial aspect. Well, the numbers are in and it looks like Nevada faired very well. Especially in comparison to the opening month revenue of other states that have legalized cannabis for medical and recreational use.
Nevada dispensaries took in more than $27 million in the first month of sales generating over $3.6 million in tax revenue for the state. In comparison, Nevada’s first month sales were almost double that of states like Colorado and Oregon. Those states earned about $14 million during their opening month of recreational sales. Washington generated $3.8 million in its first month. Another $2.7 million in tax revenue came from a special excise tax on recreational cannabis. This is specifically set aside for Nevada’s designated “rainy day fund.” Of course, Las Vegas being in the middle of a desert with little rainfall, ‘rainy day fund’ is someone’s inside joke… But I digress.
State officials projected estimates on sales figures. However, they could not be certain until they knew when many dispensaries would be completely ready for sales. Those projections showed that Nevada could gain about $63.5 million in taxes from recreational sales over the first two years. Another $1 million each year would be received from the 15% wholesale tax levied on medical & recreational cannabis when it is sent between grower and seller.
More cultivators will begin to start production as Gov. Brian Sandoval issues additional licenses to keep up with the growing demand for cannabis in the valley. So over the next two years the excise taxes will grow providing the state with even more revenue. $6.5 million was raised from cannabis license and application fees alone. The revenue from these sources will be used to cover administration costs for the tax department, which is now handling duties once slated for the state’s Division of Public & Behavioral Health.
Nevada now needs to figure out the locations where tourists can legally consume their cannabis. Currently, consumption is only allowed in private residences. It is illegal to smoke in hotels, casinos or in ANY public area. That is, without facing a $600 fine. But it won’t land you in jail for a first offense. McCarran Airport obviously will not allow you to take your purchase home with you. This is just one dilemma to overcome in order to protect the new “tax fountain of wealth” in Nevada’s growing cannabis industry.
By Tracy Jerome Chisley (@PoeticPanther)
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