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Maine Lawmakers Propose Doubling Adult-Use Tax Rate

Maine lawmakers have proposed raising the tax on adult-use cannabis sales to 20 percent, doubling the rate approved by voters in November, the Portland Press Herald reports. The proposal would see a 10 percent excise tax paid by the cultivator and a 10 percent sales tax added to cannabis products sold to recreational customers, which could equate to $21 million in state revenues during the first full year of market operations.

The committee also proposed distributing 5 percent of monies raised from retail cannabis taxes to the communities who house the businesses. Meaning municipalities would see $2 for every $40 in tax revenues from sales in their city or town.

David Boyer, Maine political director for the Marijuana Policy Project, said the proposed rate “is low enough to compete with the illicit market” and Massachusetts – where lawmakers are considering raising the legal cannabis tax rate from 12 percent to 20 percent.

“Municipalities should get a share of the tax revenue that comes with regulating legal marijuana businesses,” Boyer said.

The medical cannabis tax rates – 8 percent for edibles and 5.5 percent for everything else – would remain the same.

James Myall, a Maine Center for Economic Policy analyst, estimated that Maine’s taxed-and-regulated cannabis market could reap $18 million annually for the state after two or three years under the 10 percent rate approved by voters. According to the report, New Frontier estimates combined medical and retail cannabis sales in Maine could reach $321.4 million by 2020.

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