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Hochul wants to repeal cannabis 'potency tax'

Jan 17, 2024 1:55 am

Brendan J. Lyons reports in the Times Union that Gov. Kathy Hochul’s executive budgetannounced on Jan. 16 proposes repealing a state “potency tax” on cannabis products. The tax was meant to make more money for the state from sales of high potency cannabis, while store owners say it sends consumers looking for cheaper prices from unlicensed vendors. New York state has been slow to roll out legal stores in the two-and-a-half-years since cannabis was legalized. Many illegal stores have been open at the same time. Hochul wants to replace the potency tax with a wholesale excise tax of nine percent, which would be charged to consumers in addition to the state and local retail excise taxes of nine and four percent, respectively. State Sen. Jeremy Cooney, a Rochester Democrat, also wants to repeal the potency tax and said, "I think we also need to look at other states like Colorado that have actually had a lower tax rate than New York but has realized higher revenues. … If we’re able to really increase the volume of sales overall, even though it’s a lower tax rate, it’s better than losing it to the illicit market where we get nothing.” Allan Gandelman, president of the Cannabis Association of New York, said, “It’s definitely a big win to revise that potency tax and make it a flat tax.... I have to run the numbers and see what that (9 percent excise tax) looks like, but honestly, right now, anything is better than the potency tax because that thing was completely untenable.” Read more about this story in the Times Union.