New Mexico’s governor-appointed Marijuana Legalization Work Group has released a 16-page report with its recommendations for cannabis legalization for adults, including expungement for low-level convictions.
The report anticipates $63 million in new state and local taxes following year one, and nearly $94 million by year five. The report estimates first-year sales would reach $318 million and increase to $620 million by year five in a market with 468,000 consumers. The report calls for a 17 percent average tax rate.
“Combined, a joint medical-adult use program is anticipated to include more than 13,000 jobs at all skill and income levels and mature to generate at least $850,000,000 in annual sales which would generate almost $100,000,000 in new revenue for state and local governments annually.” – Oct. 16 New Mexico Marijuana Legalization Work Group report
The recommendations would not allow localities to “opt-out” of the industry in an effort to prohibit illegal sales but would allow local control over funds derived from the space; home grows would not be permitted under the recommended rules.
The recommendations do include social equity provisions such as grant programs, in addition to low licensing fees, and free training programs.
The group – comprised of attorneys, law enforcement, lawmakers, industry members, physicians, citizens, and environment and public health officials – suggested that industry operating fees “should not be set by statute” rather “language limiting licensing fees to the cost of regulation and/or with ‘no more than $500/mo. unless necessary to meet the cost of regulation’).”
The group also advocated for enhancing the state’s medical cannabis program, including a $3.9 million low-income medical cannabis patient subsidy program, which would grow to $7 million by year five.
Under the recommendations, the state excise tax on sales would be set at 5 percent, with a 5.125 percent gross receipts tax on businesses, a 5 percent local excise tax, and a 2 percent local gross receipts tax.
Gov. Michelle Lujan Grisham (D) created the task force in June after the legislature failed to pass cannabis legalization legislation during the session.
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