Study: Legalizing cannabis would shore up $97M annually for gov’t
The legalization of cannabis for adult use in Puerto Rico would result in $679 million in sales that could potentially shore up $97 million in new tax revenue for the government’s coffers, according to a study by Advantage Business Consulting.
The study’s findings were presented during an event hosted by the Alliance for Responsible Regulation and Economic Development (ARRDE, in Spanish), which commissioned the economic firm for the task.
“Legalizing the adult use of cannabis would generate some $679 million in economic activity between the adult cannabis industry itself, its suppliers and general consumption. It would create 5,775 jobs and would generate $126 million in payroll,” said Economist Vicente Feliciano, president of Advantage Business Consulting.
“This impact would be generated once the industry reaches its maturity in the fifth year,” Feliciano said.
The economic activity would include $433 million related to recreational cannabis sales, plus another $177 million of medical cannabis sales, in the fifth year.
If the government levies a 20% special tax on those sales, and adds other taxes generated by the new economic activity — such as income taxes and sales and use tax — by the fifth year, it would generate some $97 million annually in new collections, the study showed.
Carmen Serrano, a spokeswoman for ARRDE, said there are several measures being discussed at the Puerto Rico Legislature on the use of cannabis and its decriminalization.
“Given the current scenario, we believed it necessary as an organization to provide a real tool, which presents a complete framework, not only of the perception of people regarding legalization, but also of the economic impact that the approval of adult use of cannabis would have on the public coffers,” she said.
“Through this study we seek to guide people and our lawmakers so that they can exercise a responsible vote when evaluating legislative measures such as Bill 1191, or any other bill on the use of cannabis,” Serrano added.
The organization also presented the results of a survey conducted by firm Gaither International that revealed that the adult population between the ages of 18 and 64 widely favors the legalization of cannabis in Puerto Rico.
The results of the survey are based on 728 interviews of the 800 interviews that comprise the survey. From the data collected, it appeared that 55% of those surveyed “believe or agree that the use of cannabis by adults is safe,” the results show.
In general, most Puerto Ricans recognize the benefits that the legalization and decriminalization of cannabis brings to Puerto Rico. If the use of recreational cannabis were legalized in Puerto Rico:
- 82% agree that it will be safer to buy cannabis.
- 61% agree that it will bring more jobs and generate more money for the government;
- 57% agree that it will reduce drug trafficking;
- 63% agree it will reduce opioid addiction;
- 62% agree it will help police focus on major crimes;
- 60% agree that it will reduce the number of people who are in prison unnecessarily.
“Conducting this survey gives us the opportunity as an organization and as an island to see the panorama and be able to guide the population in general about the myths and realities of cannabis use,” said Serrano.
ARRDE is a nonprofit that seeks to advance the discussion for the approval of the adult use of cannabis and its decriminalization.