Quantcast
Environmental News for a Healthier Planet and Life

New Analysis Shows Federal Marijuana Legalization Could Raise $130 Billion, Add 1 Million Jobs by 2025

Popular
New Analysis Shows Federal Marijuana Legalization Could Raise $130 Billion, Add 1 Million Jobs by 2025
iStock

By Jon Queally

Though a key argument for legalizing marijuana in the U.S. is that it would put a tremendous and necessary dent in the domestic and global failure known as "the War on Drugs," a new analysis out Wednesday reveals that federal legalization could also raise more than $130 billion in tax revenue by 2025 while also creating more than 1.1 million new jobs.


The new study was published by New Frontier Data—a research and marketing firm whose stated mission is to "inform cannabis-related policy and business decisions through rigorous, issue-neutral and comprehensive analysis of the legal cannabis industry."

As the Drug Policy Alliance has shown, the criminalization regime and enforcement of keeping marijuana and others drugs illegal costs the U.S. government more than $50 billion annually—that includes the outrageous costs of imprisoning tens of thousands of people for nonviolent drug offenses.

Meanwhile, according to New Frontier CEO Giadha Aguirre De Carcer, the government would stand to do very well if marijuana, as has been shown in Washington state and Colorado, was taxed as a legal commodity. "The three most common business taxes that any standard business pays to the federal government are federal business taxes, payroll taxes and sales taxes," De Carcer explained. "If cannabis businesses were legalized tomorrow and taxed as normal businesses with a standard 35% tax rate, cannabis businesses would infuse the U.S. economy with an additional $12.6 billion this year."

As opposed to the current patchwork of states that have legalized either medical marijuana, its recreational use or both, the analysis looked at what could happen if the U.S. government made it legal to sell marijuana nationwide and included these major findings:

  • If full legalization occurred in all 50 states today, there would be an excess of 782,000 jobs, and would increase to 1.1 million jobs by 2025.
  • Full legalization would result in more legal businesses participating in the market, more consumers participating in the legal market, and more employees on official payrolls, resulting in $4 billion in payroll taxes. By 2025, payroll deductions would increase to $5.9 billion.
  • Assuming a sales tax at the federal level was implemented at 15 percent, the total tax revenues from 2017–2025 would theoretically be $51.7 billion. This amount of revenue would be entirely new revenue to the U.S. Treasury, as there are currently no federal sales or excise taxes.
  • By combining the business tax revenues, the payroll withholdings based on the theoretical employment required to support the industry, and the 15 percent retail sales tax, one can calculate the total federal tax revenue potential of legalization: The combined total is estimated to be $131.8 billion.
  • The difference between the current structure and the theoretical model is a $76.8 billion increase in federal tax revenues.

The new data comes in the wake of polling that shows historic levels of support for marijuana legalization nationwide. In October of 2017, a Gallup survey found that 64 percent of Americans now favor legal marijuana—the highest level ever recorded. It's also an issue that receives backing from people across the political spectrum. According to the Gallup poll, a majority of Republicans (51 percent) are in favor while Independents (67 percent) and Democrats (72 percent) support legalization at even higher levels.

Reposted with permission from our media associate Common Dreams.

Yves Adams / Instagram

A rare yellow penguin has been photographed for what is believed to be the first time.

Read More Show Less

EcoWatch Daily Newsletter

The Crystal building in London, England is the first building in the world to be awarded an outstanding BREEAM (BRE Environmental Assessment Method) rating and a LEED (Leadership in Energy and Environmental Design) platinum rating. Alphotographic / Getty Images

By Stuart Braun

We spend 90% of our time in the buildings where we live and work, shop and conduct business, in the structures that keep us warm in winter and cool in summer.

But immense energy is required to source and manufacture building materials, to power construction sites, to maintain and renew the built environment. In 2019, building operations and construction activities together accounted for 38% of global energy-related CO2 emissions, the highest level ever recorded.

Read More Show Less

Trending

Houses and wooden debris are shown in flood waters from Hurricane Katrina Sept. 11, 2005 in New Orleans, Louisiana. Jerry Grayson / Helifilms Australia PTY Ltd / Getty Images

By Eric Tate and Christopher Emrich

Disasters stemming from hazards like floods, wildfires, and disease often garner attention because of their extreme conditions and heavy societal impacts. Although the nature of the damage may vary, major disasters are alike in that socially vulnerable populations often experience the worst repercussions. For example, we saw this following Hurricanes Katrina and Harvey, each of which generated widespread physical damage and outsized impacts to low-income and minority survivors.

Read More Show Less
A gray wolf is seen howling outside in winter. Wolfgang Kaehler / Contributor / Getty Images

Wisconsin will end its controversial wolf hunt early after hunters and trappers killed almost 70 percent of the state's quota in the hunt's first 48 hours.

Read More Show Less
Tom Vilsack speaks on December 11, 2020 in Wilmington, Delaware after being nominated to be Agriculture Secretary by U.S. President Joe Biden. Jim Watson / AFP / Getty Images

By Jessica Corbett

Sen. Bernie Sanders on Tuesday was the lone progressive to vote against Tom Vilsack reprising his role as secretary of agriculture, citing concerns that progressive advocacy groups have been raising since even before President Joe Biden officially nominated the former Obama administration appointee.

Read More Show Less