“What we saw in California is that the high tax on legitimate cannabis leads straight to the black market. And I’m very concerned that that’s going to have the same or similar impact here.”
A last-minute tax hike on cannabis products passed as part of Minnesota lawmakers’ special session budget compromise may prove to be a boon to illicit dealers.
That’s according to cannabis industry experts, business owners, and at least one prominent DFL lawmaker who say the state’s relatively high cannabis tax will give consumers reason to avoid regulated, legal dispensaries in favor of informal sources on the black market.
Minnesota’s 15 percent state tax on marijuana and other cannabis products is among the highest in the country, trailing only Arizona (16 percent), Oregon (17 percent), California (19 percent), and Washington (37 percent).
“I thought it was the wrong thing to do, increasing the tax,” said Sen. Ann Rest, DFL-New Hope, chair of the Senate Tax Committee. “What we saw in California is that the high tax on legitimate cannabis leads straight to the black market. And I’m very concerned that that’s going to have the same or similar impact here.”
How do Minnesota taxes
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