Following months of disagreements, Gov. Philip D. Murphy and Democratic legislative leaders in New Jersey have reached an agreement that could make the Garden State the next to legalize recreational marijuana use.
If they can get the state legislature to agree on the proposal, that is.
The agreement on the proposed legislation establishes how marijuana would be taxed. The measure would tax pot by the ounce rather than establish a percentage-based sales tax.
“There will be a $42 excise tax on every ounce that is sold, regardless of price,” State Sen. Nicholas Scutari said in an interview with CBS New York. “There will be a three-year look-back in case we need to reevaluate that because it is a possibility that the price goes down so low that $42 becomes unmanageably high.”
The proposed measure would also establish the framework for a committee to regulate cannabis in the Garden State.
Gov. Murphy on legalizing marijuana
The proposed measure
The measure would establish a $42 an ounce sales tax on marijuana. While this price may seem high, no pun intended, it directly correlates to the price of the drug.
According to the proposed measure, if the price of marijuana stays high, New Jersey would have one of the lowest cannabis sales tax rates in the country. Unfortunately, if the price of marijuana goes down, the excise tax rate may have to change.
State Senate President Stephen M. Sweeney supported a 12 percent tax rate, while Murphy wanted a 25 percent tax rate. The issue of taxation had been one of the biggest legislative hurdles separating the governor and the state legislature.
“Weight by volume is probably the way to the future in terms of how cannabis is going to be taxed,” Mr. Scurati told The New York Times.
Scutari stated in the interview that the measure establishes a five-person oversight commission to set prices and regulations. One of the agreed-upon amendments to the measure allows Murphy to have three direct-appointments to the commission. The legislature will have the remaining two appointments to the committee.
What’s next for New Jersey?
While the measure may not have final language, the number of legal retail licenses that will be distributed, or how public consumption will be handled; two of the most contentious issues surrounding cannabis have been cleared: oversight and pricing.
The finer points of legalization have yet to be smoothed out. For example, the measure has yet to identify how many manufacturers and distributors would be allowed to open in the garden state should the measure pass.
“We have not ironed out the finer points of the bill, we haven’t formalized it into language yet, so I wouldn’t say that we have a complete agreement just yet,” Scutari said. “Some of the major sticking points between the legislature and the governor have been agreed to.”
When asked if he thinks that legalization of recreational marijuana use is in the immediate legislative future, Sen. Scutari said, “Well, as we stand here today I’m not certain that we do. I know the Senate president and speaker are working on that. But as I said earlier, we need the governor’s engagement on this.”
Pot politicos are hopeful that the major issues with the measure will be hashed out between rivaling political parties in the next month before the legislation comes to a vote in March.