New York officials are projecting that cannabis tax revenue will help keep the state’s budget afloat as cigarette sales continue to decline over the coming years.
In a first quarterly update for the 2022 fiscal year that was released this week by Budget Director Robert Mujica Jr., state analysts said that New York stands to generate about $20 million in revenue from adult-use cannabis business license fees next year. And as the market matures, cannabis tax revenue and license fees are expected to generate $245 million by the fiscal year 2025.
At the same time, cigarette tax revenue is expected to continue to decline, dropping from $972 million in the 2022 fiscal year to $852 million in 2025.
The state said that “along with the second year of license fees, the State’s THC-based and retail excise taxes on the sale of adult-use cannabis products are projected to generate $115 million,” and those increases “are partially offset by a continued decline in taxable cigarette consumption.”
In other words, New York is seeing the same trend that’s playing out nationally. People are smoking fewer cigarettes while more adults are trying cannabis. And creating a regulated market for cannabis is helping to create an alternative revenue source for states that legalize.
Read more at marijuanamoment.net