California released their tax earnings for the fourth and final quarter of 2018, completing the first full year of legal cannabis sales in the state.
The first full year of legal adult-use cannabis in California earned the state $345.2 million, according to a California Tax and Fee Administration press release. The number, reported alongside fourth fiscal quarter results, represents about half of the originally expected amount. Fourth quarter tax revenues were $103.3 million, up slightly from the previous quarter. The total number includes the combination of cannabis cultivation, excise, and sales taxes.
California has struggled to meet tax revenue predictions due largely to the persistence of the illicit market. Many theorize that the reason sales in the legal market have been so low is due to excessive taxes, which are levied not only on the state level but also county and municipal.
Many industry advocates are actively lobbying for lower taxes and, as California’s revenues have continued to coast beneath expectations, even lawmakers are starting to get onboard. At least one pending bill, Assembly Bill 286, would eliminate the cultivation tax for cannabis and would lower the excise tax.
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