COVID-19 has been quite effective at shutting down a ton of businesses. The recent pandemic has also put the cannabis industry under the spotlight, as many marijuana-legal states have deemed the sector an essential service, allowing continued operation during a time where many businesses have mandated closures.
These events have also highlighted service gaps – from the lack of banking and lending services, to the fact that recent COVID-19 federal relief funds issued through the U.S. Small Business Association (SBA) skipped over the cannabis industry entirely.
Funny how the concern about “dirty” money – and I’m talking about germs here, not any shady cash dealings – might be the proverbial straw that broke the camel’s back, at least when looking at political leverage. If activists play their cards right, they could use these recent events to align the cannabis industry into an accepted economic support. Let’s look at two really big ways that the coronavirus could shape the future of cannabis: taxes and employment.
Time and time again, legal marijuana has shown that it is a lucrative source of tax revenue. At this point, it should be obvious: people are willing to pay the taxes levied in weed. Period. According to estimates by New Frontier Data, the feds have taken in approximately $2.8 billion in taxes related to cannabis. In 2019, the state of California generated $635 million in cannabis tax revenue. Those aren’t insignificant numbers, and those sorts of figures are proof positive that supporting the legal marijuana industry will help the economy.
If lobbyists and activists play their cards right, they will be able to convince lawmakers that the cannabis industry might be the sector that props up state governments that are seeing shortfalls in tax revenue from other industries obliterated by the COVID-19 shut downs.
Another effect of the recent COVID-19 pandemic shut-down is the loss of jobs. And guess what? The cannabis industry can help buffer that blow, too. If current events prove a point, it is that people are actively purchasing (and consuming) cannabis. Flourishing industries are growing industries. And growing industries need people to expand and operate. That means jobs are on the table — and this could be another leveraging point when pushing for marijuana reform and legalization.
Michael Bronstein, co-founder of the American Trade Association of Cannabis and Hemp told Marijuana Business Daily that, “The COVID-19 response has shown just how critical cannabis is to the overall economy and job markets in a number of these states, and it’s very hard for the federal government to ignore that. It’s getting increasingly hard for members of Congress to ignore that,” adding, “That’s the message we’ve always kind of carried, but right now, more than ever, (Congress is) going to be paying attention to any industry that has the opportunity to create more jobs—especially when you look at the service sector. It’s a staggering unemployment rate we’re going to be looking at.”