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April 11, 2023

Tax Stringer: "New York Adult-Use Cannabis THC Potency Tax"

Jason Klimek, Cannabis Team co-leader, had his “New York Adult-Use Cannabis THC Potency Tax” article published in Tax Stringer. The article notes that Article 20-C, which includes both the THC potency tax and the adult-use retail tax, was added to the New York State Tax Law when the Marijuana Regulation and Taxation Act (MRTA) was passed. 

Jason’s article details the THC potency tax, which is an excise tax paid by the retailer to the distributor in most cases, and breaks down the effective retail tax rates for flower, concentrate, and edibles. 

The article also explains that some of the largest barriers to a successful legal cannabis market in New York State are the illicit market and nonenforcement: “Since legalization in New York, thousands of shops have popped up purporting to be legally selling cannabis under dubious legal theories . . . These practice are illegal in New York and result in lower cannabis tax revenue and unfair competition with the legal market.” The state has introduced measures to combat illicit cannabis sales.

Click here to read the full article. 


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