Moody’s Investors Service, Inc., a leading credit ratings, research, and risk analysis company, confirmed today that legalized marijuana provides positive revenue for states and localities which have permitted retail sale of marijuana, even taking into account the cost of regulation. While the share of the general revenue provided by taxes and licensing fees is relatively small – 1.2 percent of the general revenue in Washington and 2 percent in California, for example – that is in line with Governor Phil Murphy’s projections, which have accounted for an additional $60 million (less than 1% of the budget) in taxes from legalized marijuana in the next fiscal year. Moody’s also notes the potential to increase employment and decrease the burden on judicial resources where marijuana is legalized.
As Moody’s notes, 29 states have legalized some form of marijuana use, and 9 states, as well as the District of Columbia, permit recreational use. Governor Murphy strongly supports legalization of recreational use, and the New Jersey legislature is currently considering the issue.
Pashman Stein Walder Hayden is carefully monitoring developments in New Jersey and federally with respect to marijuana legislation and will be available to help its clients navigate the sure-to-be complex regulatory framework of this potential business frontier.