ZA: Cannabis tax could be a 'gold mine' for country's economy, expert says

South Africa could be sitting on a tax revenue gold mine in the form of legal cannabis, says Ettiene Retief, chairman of the National Tax Committee at the South African Institute of Professional Accountants (SAIPA).

Unfortunately, the government has so far failed to exploit a massive, untapped market for recreational cannabis consumption, both locally and globally, Retief said.

Retief cites the success of Colorado in the USA. In 2012, its citizens voted to legalize recreational cannabis use for adults. Since then, the state has seen over $10 billion in total sales and, in the last six years, tax on the product has amounted to over $1.6 billion at the state level alone.

Revenue resulted from a 2.9% sales tax on medical and recreational sales and a 15% excise tax when the cannabis leaves the grower. This excludes tax on industrial hemp, which the state legalized in 2010.

Witnessing the sustainability of this new tax revenue stream in both Colorado and Washington, four more states voted last year to legalize cannabis – New Jersey, South Dakota, Montana, and Arizona.

Read more at businesstech.co.za


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