The trade body revealed that tax contributions from the state’s marijuana industry increase 33% year-on-year to $99.18 million in the 2019 fiscal year. The state also earned another $10 million from licensing fees, taking the total well past the $100 million barrier, according to the association’s press release.
Legal sales of recreational marijuana began in Nevada in 2017, following a ballot initiative the previous year. In October 2018, Andrew Jolley, president of the Nevada Dispensary Association, predicted that the industry would produce around $1 billion in tax revenues for the state and local governments between 2018 and 2024.
He estimated that the industry would provide $113 million in 2018 and $144.8 million in 2019, so it appears to be falling a little short of his projections right now. A report last month from PEW illustrated just how difficult it is for states to predict revenue from cannabis tax, but the Nevada Dispensary Association is pleased with the progress it is making.
However, it warned that the black market continues to hamper the performance of the legal industry in the Silver State. “Significant changes in the market or regulatory framework could impact tax collection,” said Riana Durrett, the group’s director. “The illegal market continues to deprive the state of funds that could be going to education.”
The Planet 13 Holdings (CSE: PLTH) superstore in Las Vegas is a major driver of growth in the state’s legal cannabis market. In August 2019, it had 62,833 customers and its average transaction price stood at $90.25, equating to $5.67 million in sales for the month.
Its share of the Nevada cannabis retail market is now greater than 9% and it is opening a customer-facing production facility, coffee shop, and bistro later this month, as it bids to live up to its billing as the Disneyland of cannabis.
The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Grizzle hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.