Marijuana Business Magazine May-June 2020

Marijuana Business Magazine | May-June 2020 114 For information about cannabis regulations in other markets, order the Marijuana Business Factbook at mjbizdaily.com/factbook. Main measures State tax requirements Sampling of state licensing & application fees Question 4 (2016) The tax rate for consumers is up to 20%, including 6.25% state sales tax, 10.75% state excise tax and up to 3% local tax for cities and towns. Application (nonrefundable) Cultivator: $100-$2,000, depending on canopy size and whether indoor/outdoor Craft Marijuana Cooperative: $100-$2,000, depending on canopy size and whether indoor/outdoor, plus additional fees for each grow site in excess of six Marijuana Retailer (brick and mortar): $1,500 Existing Licensee Transporter: $1,000 Third-Party Transporter: $1,500 Marijuana Research Facility: $300 Testing Laboratory: $1,500 Microbusiness: $1,000 Delivery-Only Licensee: $1,500 Social Consumption Establishment: $1,500 License (initial and annual) Cultivator: $625-$50,000, depending on canopy size and whether indoor/outdoor Craft Marijuana Cooperative: $625-$50,000, depending on canopy size and whether indoor/outdoor, plus additional fees for each grow site in excess of six Marijuana Retailer (brick and mortar): $10,000 Existing Licensee Transporter: $5,000 Third-Party Transporter: $5,000 Marijuana Research Facility: $1,000 Testing Laboratory: $10,000 Microbusiness: 50% of all applicable fees Delivery-Only Licensee: $10,000 Social Consumption Establishment: $10,000   What to watch Until late March, recreational marijuana businesses were continuing to open across the state in areas that had opted into the program. The impact of COVID-19 and associated forced business closures is a great unknown. If the closures last only a short time, sales are expected to increase, and retail prices (which have been among the highest in the nation) will come down as more retailers and cultivators come online. If the closures last longer, sales might not reach their full potential, and companies will feel the financial impact—possibly going out of business. Massachusetts has developed a comprehensive social equity program that so far has seen a limited number of successful applicants. By early February 2020, the state’s Cannabis Control Commission (CCC) reported that nearly 75% of the state’s legal marijuana workers were white, and less than 4% of licensed business were companies certified under the social equity program. If the state follows through with the idea, expect to see changes in the demographics of state marijuana business owners. Since beginning sales in November 2018, the state’s recreational marijuana program has been red hot. Massachusetts retailers brought in more than $440 million in sales in 2019, and that figure is expected to increase as the program continues to develop. However, due to fears that out-of-state customers would visit recreational stores during the coronavirus pandemic, Gov. Charlie Baker ordered rec shops to close until at least May 4. The financial impact of the closure remains to be seen. In early March, Boston saw the opening of its first adult-use retail outlet, Pure Oasis, one of only a hand- ful of successful applicants in the state to apply under the social equity program. Before the coronavirus outbreak, Marijuana Business Daily estimated Massachusetts’ 2020 recreational sales would hit $575 million-$700 million. Forced business closures will likely shift annual sales totals down: The longer the closures, the more downward pressure on sales. —Maggie Cowee MarketAtAGlance | Massachusetts