Pennsylvania lawmakers to again consider adult-use cannabis measure

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Pennsylvania Democrats, as expected, are trying again to legalize adult-use cannabis through legislation.

State Reps. Jake Wheatley and Dan Frankel on Tuesday introduced House Bill 2050, which would create a recreational marijuana market with limited licensing, a social equity emphasis and a retail sales tax rate that would begin at 6% and gradually go up to 19% by the fifth year.

Pressure has increased on Pennsylvania to legalize recreational marijuana sales now that neighboring New Jersey is preparing to launch a market next year.

Pennsylvania Gov. Tom Wolf has been urging lawmakers to legalize recreational marijuana since last year.

But the GOP-controlled Senate still is considered a major obstacle, as it has been during previous efforts.

House Bill 2050, according to a Marijuana Policy Project summary, features:

  • A grant program to help minorities, women and small businesses benefit from the industry. Initial application and permit fees also would be lower to reduce financial barriers.
  • Limited licensing of no more than 50 growers, 50 processors and 100 retail permits with up to three locations each.
  • Up to 35 combination permits would be issued, and a combination licensee could seek up to three grower permits, up to five processor permits and 10 retail permits.
  • A retail sales tax rate of 6% for the first two years, 12% for the third and fourth year of the program and 19% thereafter. An additional retail sales tax rate of up to 3% could be charged by municipalities.
  • A 10% wholesale tax. But growers and processors that partner with Pennsylvania farms wouldn’t be required to pay that tax.

Marijuana M&A activity has been sizzling in Pennsylvania because of a robust medical cannabis market and the potential of adult use in the near future.

The 2021 MJBizFactbook projects that MMJ sales will reach $775 million-$925 million this year. But sales could be affected after New Jersey’s recreational marijuana market launches.