While federal cannabis legalization efforts flounder in the Senate, individual states are deciding for themselves whether to allow recreational weed.
While more than two-thirds of Americans are in favor of legal recreational weed, according to a recent Gallup poll, state legislatures have to weigh a lot of factors when deciding whether to end prohibition.
One of the biggest positives going for cannabis is its popularity — because in America, taxing vice can be lucrative and marijuana is proving to be one of its most lucrative vices.
Just How Lucrative?
Of the 11 states that allowed adult-use sales in 2021, seven had cannabis outstrip alcohol in sin tax revenue.
Including California, which reported $832 million in tax revenue, more than doubling alcohol revs.
Combined, the 11 states reported $2.95 billion in cannabis excise taxes, according to the Institute on Taxation and Economic Policy. Alcohol Excise Taxes and Liquor Store Profits for the 11 states totaled $2.5 billion.
Tobacco remains the top “sin tax” revenue source thanks to excise taxes ranging from 9 to 18 cents per cigarette. Tobacco excise taxes raised $5.9 billion, nearly double the amount from cannabis.
Europe Takes Steps Towards Legalization
Cannabis is one area where Europe may be more conservative than the U.S.
Legalization efforts have traditionally moved more slowly across the Atlantic than they have stateside.
But there have been signs that Europe is ready to start moving forward on adult-use cannabis, and once the first domino falls, the rest of the continent won’t be far behind.
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Germany might be the closest country to legalize the drug. It is also the biggest economy in Europe, so movement there would be a big deal for adult-use efforts.
In the meantime, Basel, Switzerland is launching an adult-use cannabis pilot program this summer to study the effects on the physical and mental health of citizens there.
Switzerland’s Health Office stated that Zurich, Geneva and Bern have also applied to conduct similar trials.
The office estimates that there are 220,000 regular cannabis consumers in Switzerland despite it being prohibited in the country.
Medical cannabis is legal in the country.
Financial Services for Cannabis Operations
The SAFE Banking Act is also making its way through the legislative process once again.
Because there is a slim chance that the bill survives to see Congressional approval, small cannabis businesses are lining up increasingly different options for funding.
Bespoke Financial says it is the first fintech lender in the country to provide debt financing to cannabis companies.
It has announced a strategic partnership with PayQwick, which bills itself as the cannabis industry’s most comprehensive treasury and financial services platform.
“The lack of access to traditional financial services including deposit accounts and lines of credit have been major roadblocks in the early years of the cannabis industry,” Bespoke said.
The partnership will allow Bespoke clients to access preferred deposit fees in addition to free money transfers to mutual Bespoke and PayQwick customers.