New York’s potency tax could result in very expensive weed – here’s how much

Buying legal marijuana in New York is about to become a reality as the state legalizes recreational use in 2021. Now, new reports say the Empire State could impose a potency tax that could take weed prices up to $70 an eighth.

According to Syracuse.com, the law would tax traders different amounts depending on the milligrams of THC associated. Distributors would tax flower at half a cent, concentrates at eight-tenths of a cent, and edibles at three cents.

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Last year, New York announced its complex cannabis tax plan, which, while not the highest in the country, could be the most complex. Instead of tying the wholesale tax to factors like weight or volume, New York would tie the tax to the amount of THC in a product.

New York is the first state to tax cannabis in this way, with many industry experts calling the plan overly complicated. “I mean, it’s great that we finally have marijuana legalized, but this THC-based tax is something that could create a lot of problems,” said Kaelan Castetter of Castetter Cannabis Group. She argues that this complex plan could put a new industry in a difficult position as it is just getting started while at the same time coping with a pandemic. She predicts the tax could increase costs, which appears to be the case as we get closer to opening legal cannabis stores.

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Still, not everyone is upset by New York’s new taxes. “It’s an interesting approach,” cannabis rights specialist Rob DiPisa told Syracuse.com. “Obviously New York is paying attention to how THC is now driving value and growth in the industry. It may be the first, but I see this becoming a trend in other states.”

Others believe the tax could push cannabis workers to create strains and cannabis products that aren’t as dependent on THC, giving other compounds a chance and showing people that cannabis is much more than just a single element.

Sales of legal cannabis could begin by the end of the year after a program is planned to issue cannabis licenses to people affected by marijuana-related convictions.