 As the state with the highest population, California leads the pack when it comes to cannabis sales. And the state tax revenue reflects that, having garnered more than $4 billion in taxes from legal cannabis sales.
But while the state is enjoying their cash windfall, the cannabis industry in the state remains struggling due to exorbitant cannabis licensing fees and taxes, as well as the fact that cannabis businesses are not allowed to deduct business expenses from their taxes. All this has led to the financial death of too many cannabis companies, and the departure from the state for many multistate operators, too. One of those brands that is pulling the plug on their California operations is called “Garcia Hand Picked,” which was created by relatives of Grateful Dead icon Jerry Garcia. Garcia Hand Picked have now removed products from stores, and ceased operations within the state. Cannabis consultant Andrew DeAngelo, told the SFGate, “This was a hard decision for them, they love California. They were born and bred here. This is very painful for them, I guarantee that.” DeAngelo went on to say that the failure of a brand with Garcia's name attached to it is worrisome sign for other cannabis businesses in the state. Matt Yamashita, who is the distributor of Grizzly Peak, told the Daily Mail, “In the next 12 months, I think half the retailers are going to be in business. I think 80 percent of the people in business will be gone.” Part of the effect from that type of exodus of legal companies, is the inevitable growth of the illicit market. Amanda Reiman, a researcher for New Frontier Data, told CNBC, “If one goes down, another one just pops up.” Comments are closed.
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