Legal marijuana sales in US 'bigger than dot-com boom'

Legal marijuana sales in US 'bigger than dot-com boom'

Posted about 7 hours ago
Marijuana
Photo: The report said the marijuana industry could post sales topping $27.9 billion by 2021. (Reuters: Jason Redmond)
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Related Story: Iconic Hollywood sign vandalised to read 'Hollyweed'
Map: United States

New figures put North America's legal marijuana "green rush" above the dot-com boom of the early 2000s in terms of industry growth, according to Forbes.

North America's legal marijuana market posted $US9.3 billion ($12 billion) in revenue in 2016 — a 30 per cent increase on 2015 — according to a report by ArcView Market Research, a leading cannabis research publisher.

The report said the industry could post sales topping $US20.2 billion ($27.9 billion) by 2021, assuming a compound annual growth rate of 25 per cent.

"To put this in perspective, this industry growth is larger and faster than even the dot-com era," Forbes said.

The magazine reported GDP grew at 22 per cent during the dot-com boom, which saw dial-up internet replaced by broadband.

"Twenty-one per cent of the total US population now live in legal adult-use markets," ArcView chief executive officer Troy Dayton told Forbes.

He said sales in Colorado, Washington and Oregon jumped 62 per cent between the period of September 2015 and 2016.
States voted to legalise drug on election day

At last year's US presidential election, nine states voted on whether or not to legalise the use of private marijuana or approve its use for medical treatment.
Jake Dimmock tends to plants at the NPRC

Photo: Nine states voted on the legalisation of marijuana at the presidential election. (ABC News: Louie Eroglu)

California, Massachusetts, Nevada and Maine voted in favour of recreational marijuana use.

They joined other states that had already passed similar laws since 2012, including Washington, Colorado, Oregon and Alaska.

In Australia, the main debate about marijuana has been around its medical use — especially for people with a terminal illness.

Last year, the Federal Government passed laws permitting the drug to be grown for medicinal and related scientific purposes.

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http://www.abc.net.au/news/2017-01-04/legal-marijuana-sales-'bigger-than-dot-com-boom'/8161218?

As a grower and small business owner I am glad to be a part of this movement

Use the link below to find your elected officials that represent you in your state.
http://norml.org/states
Please get out there and vote for your right to use the cannabis plant legally if you are not in a legal state. Be part of the reason prohibition ends!

And all the ****** they locked up for having a sack will stay locked up for having a sack

hennessy
As a grower aren't you trippin that higher corporate can come and tax you?

Wayniac211 said:

hennessy
As a grower aren't you trippin that higher corporate can come and tax you?

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Not sure if you are asking if I'm worried about the government taxing me, or, big corporations swooping in and making it impossible for small businesses to compete (due to economies of scale and having lawmakers in their pockets). I'll answer both:

• Government taxation: On a personal level I am not worried. I grow as a hobby and do not sell. From a business perspective, it is something I have already planned for (~60% :x )
• Big corporations monopolizing the industry: Definitely a big concern of mine and many other activists. We are doing everything we can to keep this from happening. Even this post with the link at the bottom is me attempting to get more people active in the movement.

The real question is (sadly) when will the Marijuana Lobby (NORML, etc...) have enough sway (money) to overcome the prohibitionist deadlock from Pharmaceutical, Alcohol, Tobacco, Police, Prison and Drug Testing lobbies? Not to mention internal pressure from the DEA to be able to keep balooning their budgets on malum prohibitum issues instead of actually targeting cartels, and local meth and heroin operations. There is, at present, no more effective means of influencing policy than with money.

Not surprising.

know a lot of small local growers and they are worried about the big companies moving in
then again, they have safes full of cash buried and probably can retire

Wouldn't the big companies have to lower their prices to get people to shop with them over smaller businesses?

I wonder how much time is consumed by tending to multiple plants daily And how soon you see profits.

Hennessy said:

Not sure if you are asking if I'm worried about the government taxing me, or, big corporations swooping in and making it impossible for small businesses to compete (due to economies of scale and having lawmakers in their pockets). I'll answer both:

• Government taxation: On a personal level I am not worried. I grow as a hobby and do not sell. From a business perspective, it is something I have already planned for (~60% :x )
• Big corporations monopolizing the industry: Definitely a big concern of mine and many other activists. We are doing everything we can to keep this from happening. Even this post with the link at the bottom is me attempting to get more people active in the movement.

The real question is (sadly) when will the Marijuana Lobby (NORML, etc...) have enough sway (money) to overcome the prohibitionist deadlock from Pharmaceutical, Alcohol, Tobacco, Police, Prison and Drug Testing lobbies? Not to mention internal pressure from the DEA to be able to keep balooning their budgets on malum prohibitum issues instead of actually targeting cartels, and local meth and heroin operations. There is, at present, no more effective means of influencing policy than with money.

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As far as business taxes go (if you choose to go that route), try to maximize your cost of goods sold (COGS). As a grower, this is easier to do compared to a dispensary because you can allocate a lot of your expenses to growing and manufacturing. Keep in mind, you can't deduct normal business expenses (section 280e of the IRS) and the government is going to make sure of that

Hennessy said:

Not sure if you are asking if I'm worried about the government taxing me, or, big corporations swooping in and making it impossible for small businesses to compete (due to economies of scale and having lawmakers in their pockets). I'll answer both:

• Government taxation: On a personal level I am not worried. I grow as a hobby and do not sell. From a business perspective, it is something I have already planned for (~60% :x )
• Big corporations monopolizing the industry: Definitely a big concern of mine and many other activists. We are doing everything we can to keep this from happening. Even this post with the link at the bottom is me attempting to get more people active in the movement.

The real question is (sadly) when will the Marijuana Lobby (NORML, etc...) have enough sway (money) to overcome the prohibitionist deadlock from Pharmaceutical, Alcohol, Tobacco, Police, Prison and Drug Testing lobbies? Not to mention internal pressure from the DEA to be able to keep balooning their budgets on malum prohibitum issues instead of actually targeting cartels, and local meth and heroin operations. There is, at present, no more effective means of influencing policy than with money.

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idk.. I just don't want these folks monopolizing the green. Good point you brought up about the lobbying. Don't know too much about it. Bout to read up on this ****.

i just cant wait til i can go buy a box of marlboro kush's instead of these marlboro reds......100 % serious.

iLLiCiT305 said:

i just cant wait til i can go buy a box of marlboro kush's instead of these marlboro reds......100 % serious.

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What if they decide to put in all those same chemicals that's in their tobacco?

AEA18 said:

What if they decide to put in all those same chemicals that's in their tobacco?

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In California, new regulations state that there will be testing for cannabinoids, contaminants, microbiological impurities, and other compounds

AEA18 said:

Wouldn't the big companies have to lower their prices to get people to shop with them over smaller businesses?

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Most people will just buy it the legal way even if it does cost more because they don't have the connects. Going into a dispensary and paying a cashier is more comfortable for a lot of folks

usdlaw said:

AEA18 said:

What if they decide to put in all those same chemicals that's in their tobacco?

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In California, new regulations state that there will be testing for cannabinoids, contaminants, microbiological impurities, and other compounds

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I wouldn't trust big companies/big tobacco with selling a pure product.

I'm sure a lot of people would feel the same way and that's why I think big companies/big tobacco would have to lower prices to get customers.

How do I become a grower??

I kno the growers in Michigan got business booming but then again that's just the medical stuff

AEA18 said:

I wouldn't trust big companies/big tobacco with selling a pure product.

I'm sure a lot of people would feel the same way and that's why I think big companies/big tobacco would have to lower prices to get customers.

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It's the dept of public health (a state agency) that will monitor the testing of product. I agree with you that having big companies policing themselves would be a conflict of interest that would harm the public

heLiumcLinton said:

AEA18 said:

Wouldn't the big companies have to lower their prices to get people to shop with them over smaller businesses?

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Most people will just buy it the legal way even if it does cost more because they don't have the connects. Going into a dispensary and paying a cashier is more comfortable for a lot of folks

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the dispensary is a block from my home i usually get the hook up and some extras
if they start taking health insurance

Wavy Daddy said:

I wonder how much time is consumed by tending to multiple plants daily And how soon you see profits.

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~20 minutes per plant daily. Sometimes much more time than that. How soon you see profits depends on how much you invested into the grow and what your yield is.

From seed germination to harvest is roughly 16 weeks. Then you'll want to cure the flowers for an additional 8 weeks minimum.

I have one room for veg and one room for flowering so I'm harvesting in a perpetual cycle every 8 weeks.

usdlaw said:

Hennessy said:

Not sure if you are asking if I'm worried about the government taxing me, or, big corporations swooping in and making it impossible for small businesses to compete (due to economies of scale and having lawmakers in their pockets). I'll answer both:

• Government taxation: On a personal level I am not worried. I grow as a hobby and do not sell. From a business perspective, it is something I have already planned for (~60% :x )
• Big corporations monopolizing the industry: Definitely a big concern of mine and many other activists. We are doing everything we can to keep this from happening. Even this post with the link at the bottom is me attempting to get more people active in the movement.

The real question is (sadly) when will the Marijuana Lobby (NORML, etc...) have enough sway (money) to overcome the prohibitionist deadlock from Pharmaceutical, Alcohol, Tobacco, Police, Prison and Drug Testing lobbies? Not to mention internal pressure from the DEA to be able to keep balooning their budgets on malum prohibitum issues instead of actually targeting cartels, and local meth and heroin operations. There is, at present, no more effective means of influencing policy than with money.

Click to expand...

As far as business taxes go (if you choose to go that route), try to maximize your cost of goods sold (COGS). As a grower, this is easier to do compared to a dispensary because you can allocate a lot of your expenses to growing and manufacturing. Keep in mind, you can't deduct normal business expenses (section 280e of the IRS) and the government is going to make sure of that

Click to expand...

Wow I'm shocked that you know of section 280e of the IRS. You seem very knowledgeable! Thanks for the insight this is something I've already considered and would like to expand on for others reading the thread.

The FDA has been attempting to shut down CBD producers on behalf of big pharma (specifically GW Pharmaceuticals) for years. See the 2016 round of cease and desist letters sent to CBD (the same stuff that was just classified as medicine overseas) producers by the FDA here: http://www.fda.gov/NewsEvents/PublicHealthFocus/ucm484109.htm

The DEA is now getting involved in an effort to consolidate power at the federal level and bully the industry into submission with the threat of imprisonment. And as you've mentioned, don't even get me started on the IRS The DEA may get the press for doing **** like this, but the IRS is the federal agency that poses the biggest existential threat to the legal cannabis industry.

The IRS isn't the force that would prevent cannabis from being legalized within the states. However, it is the force that makes the commercial production and dispensing of cannabis economically feasible.

The IRS position on the industry is these people are Schedule 1 drug traffickers. This is in spite of the fact the that these people have not been convicted of drug trafficking in any court and are in compliance with all state and local law. The IRS position that this activity is drug trafficking leads them to try and enforce a little known section of the Internal Revenue Code: 280E. IRC 280E is the shortest section of the IRC that exists. You can see the full code section here: https://www.law.cornell.edu/uscode/text/280E

280E rose out of the cocaine cowboys days. Cocaine traffickers were doing things like taking tax deductions for the business use of their yachts. Prior to the implementation of 280E, a cocaine trafficker would be entitled to these deductions as they are ordinary and necessary for the performance of the business activity. Well, this was the early 80's, the drug war was in full swing, and tough on crime was the montra of the day. Congress wasn't going to let these drug traffickers take tax deductions. So, they armed the IRS with 280E as another weapon to completely ruin these people.

Fast forward about 25 years and we start getting actual businesses opening cannabis dispensaries in California. We're talking 2006, right in the heart of the Bush administration. Christ, these are the same people that sent Chong to prison for a year for ******* bongs. They weren't going to let these hippies sell marijuana in the open on their watch, no matter what state law says. Thus began the military style raids of these businesses as they were technically in violation of the United States Controlled Substances Act. The feds looked deep into their bag of tricks for anything to stop what was happening at the state level. There they found IRC 280E. They couldn't get these people criminally because they were insulated by state law. However, they could ruin them financially with the IRS and 280E.

When enforced, 280E disallows all deductions for administrative and selling expenses. This means that the taxpayer cannot take any deduction for things such as advertising, legal expenses, rent of their retail space, wages paid to retail employees, and the list goes on. The only deduction the IRS would allow would be for the cost of inventory. The result is that these businesses wind up paying over 100% effective tax rate. Meaning, your taxable profit without 280E might be $100k, but when 280E is imposed, your tax bill is $200k. It is a completely untenable economic situation. The National Cannabis Industry Association (a great organization) has put out this fact sheet about how 280 is the cancer within the legal cannabis industry: https://thecannabisindustry.org/uploads/2015-280e-white-paper.pdf

We have come very far in that so many states are no longer indiscriminately imprisoning people for the use of cannabis. However, many of the business owners who have risked their freedom to bring us to this point will be financially destroyed before this is settled. So many already have been.

Zyzz said:

How do I become a grower??

I kno the growers in Michigan got business booming but then again that's just the medical stuff

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Find a mentor and start small.

Zyzz said:

How do I become a grower??

I kno the growers in Michigan got business booming but then again that's just the medical stuff

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Start reading bro. There's a lot to it and a decent size learning curve so be prepared for that especially if you can't find someone to put you on. If you know someone that already grows I would spend as much time over there as you can and watch a full cycle.

Hasn't even scratched the surface. Find a niche and prosper.

I have a buddy who has an ecommerce horticulture supply company. Dude started in 2011. Im pretty sure he cleared 50mil in revenue last year off amazon sales alone.

What a time to be alive.

I just want it to say right on the bag "regular weed"

Oh YoU MaD said:

I have a buddy who has an ecommerce horticulture supply company. Dude started in 2011. Im pretty sure he cleared 50mil in revenue last year off amazon sales alone.

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this seems like the best move to be honest, I read a article recently about Scotts wanting to invest 500 million into this side of the marijuana boom.