Pubdate: Thu, 19 Jul 2018 Source: Philadelphia Daily News (PA) Copyright: 2018 Philadelphia Newspapers Inc. Contact: http://www.philly.com/dailynews/about/feedback/ Website: http://www.philly.com/dailynews/ Details: http://www.mapinc.org/media/339 Author: Sam Wood PA. REPORT: LEGALIZING MARIJUANA COULD GENERATE $580 MILLION IN STATE TAX REVENUES Legalizing marijuana for adult recreational use in Pennsylvania could generate more than $580 million in tax revenue for the state, said Auditor General Eugene DePasquale in a report issued Thursday morning. "Pennsylvania's budget challenges are now a consistent factor in all state policy decisions," said DePasquale. "Taxing marijuana offers a rare glimmer of fiscal hope, providing a way to refocus the state budget process away from filling its own gaps." Last year, the state faced a shortfall of more than $2 billion. DePasquale proposes levying a 35 percent tax on any recreational marijuana that would be sold in state-sanctioned retail stores. Pennsylvania's medical marijuana program launched in February and serves about 28,000 eligible patients. But neither Gov. Wolf, a Democrat, nor the Republican-controlled state legislature appear ready to support adult recreational use. Nine states and Washington D.C. have legalized marijuana for adult use though the federal government still considers it to be a Schedule 1 substance on par with heroin and LSD. DePasquale's report assumes that nearly 800,000 Pennsylvanians consume cannabis every month and spend a little more than $2,000 a year on their weed. Based on those numbers, the current underground marijuana economy generates about $1.6 billion each year. DePasquale said Philadelphia, given its status as a tourist destination, could reap an additional $6.9 million if it imposed a 2 percent local tax on legal marijuana sales. Marijuana advocates, however, warn that DePasquale may be overreaching. "Those estimates assume that Pennsylvania would be able to capture the entire underground market overnight," said Chris Goldstein, a cannabis advocate who has taught a course on marijuana and journalism at Temple University and written for Philly.com. "No state that has legalized marijuana has been able to get all its consumers to participate in the regulated market." Goldstein said that's because state-regulated marijuana is often exorbitantly priced when compared with illegal weed. In Colorado last year, legal marijuana generated $247 million in taxes, licenses and fees. Pennsylvania's population is twice that of Colorado's. DePasquale's numbers pale in comparison to revenue estimates prepared last year for St. Sen. Daylin Leach (D., Montgomery). Leach, who has introduced several cannabis legalization bills in Harrisburg, believes that adult use marijuana could pour $1.5 billion in taxes into state coffers after four years. "It's a very substantial amount of money for the state," Leach said "And that doesn't take into account the money saved by not having to arrest, prosecute and incarcerate people for those crimes."