Pot users in New Jersey are facing the inverse, with consumers confronting high prices as trade groups accuse the state of slow-walking licenses that could increase the number of cannabis operators supplying the legal market.
“There’s definitely significant headwinds across the board, and part of that is there is oversupply in western states,” said Aaron Smith, co-founder and CEO of the National Cannabis Industry Association. “The industry is really over-regulated, overtaxed — we know that — and we’re competing against an existing underground market that has been thriving for decades.”
Much of the angst around legalization centered on the potential harm from products with high levels of THC, the active ingredient in cannabis, or fears of an increase in drug-influenced driving and accidents. “After nearly a decade of unbroken double-digit job growth, the cannabis industry collectively pressed pause on new hiring in 2022,” the report said.
The New Jersey Cannabis Regulatory Commission says individual businesses, including trade association members, set the prices that consumers face and everyone should work together. Industry players said they hope the growing appetite for legalizing marijuana comes with a federal desire to let states shuffle their products around the country.
Senators in both parties are championing a bill that would give the cannabis industry access to banking without fear of penalties or high fees, saying financial rules must adjust with marijuana laws so that businesses are treated equally and workers are no longer paid in cash and exposed to robbery. “Year over year increases in regulations and taxes continue to drive business costs up, while inflation, purchase limits, and a lack of merchant processing make it more difficult for patients and consumers to access cannabis, which drives them to the illicit market,” MIG Executive Director Truman Bradley said.
For years, marijuana businesses have complained that listing marijuana as a Schedule I drug subjects them to “Section 280E” tax provisions that prevent them from taking traditional deductions for business expenses.