Weed Wars

Dispatches from the California Marijuana Front

May 7, 2010
New estimate says dispensaries may reach $1.3 billion in sales

IMG_0153.JPGCalifornia's medical marijuana dispensaries generate as much as $1.3 billion in sales and $105 million dollars in state sales taxes, according to new -- and dramatically increased -- state sales estimates.

The new calculations by California's Board of Equalization reflect both a burgeoning legal medical pot trade and improvements by the state in calculating the scale of the industry.

"It's based on further research in the last year," said BOE spokesman Anita Gore. "We just have better data."

The BOE earlier this year estimated medical marijuana transactions at only $98 million, with $8 in resulting sales taxes. That figure was actually revised downward from an original estimate of $200 million in medical marijuana sales and $18 million in sales taxes.

The latest BOE estimates say medical marijuana outlets currently generate between $701 million and $1.3 billion in sales, providing California with $58 million to $105 million in annual sales taxes, Gore said.

State guidelines for medical pot outlets say they must operate as non-profit, members-only patient collectives that receive "contributions" or "reimbursements" for costs and services of cultivating, supplying and dispensing medical marijuana.

But the state makes no distinction on what the dispensary transactions are called - it considers them all to be taxable sales under the law. Dispensaries are also required to have state sales permits.

Gore said the BOE is calculating the scale of the medical marijuana market based on reports from numerous agencies with information on dispensaries operating in California communities.

She said the BOE doesn't require the medical pot outlets "to tell what they sell.

"We don't have a special category for medical marijuana dispensaries," Gore said. "They can be listed as various things from...health foods to general merchandise. The range is pretty great. But some people do tell us."

Pictured: Some of the offerings at Sacramento's Unity Non-Profit Collective. Peter Hecht/phecht@sacbee.com

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