By Aaron Kesel
Nevada’s Governor Brian Sandoval declared a state of emergency over recreational marijuana regulations after the Nevada Tax Commission reported a shortage of medical weed in its many stores.
The Nevada Tax Commission stated that it will consider implementing emergency regulations on July 13 to provide a stronger structure for marijuana distribution to retailers. These new regulations would also allow for liquor wholesalers to get into the marijuana business.
“Based on reports of adult-use marijuana sales already far exceeding the industry’s expectations at the state’s 47 licensed retail marijuana stores, and the reality that many stores are running out of inventory, the Department must address the lack of distributors immediately,” The Nevada Tax Commission told Fox News. “Some establishments report the need for delivery within the next several days,” it added.
The problems of distribution stem from a lawsuit between the state and Nevada’s liquor industry, which sued to get in on the business. Nevada’s tax authority claimed that most liquor retailers have yet to meet the requirements to be licensed to sell medical cannabis.
The bill stipulates that for the first 18 months of cannabis sales only wholesale alcohol distributors are allowed to transport marijuana from cultivation facilities to the dispensaries. The dispensaries themselves are barred under the law.
Nevada is the only state out of four other states — Colorado, Oregon, Washington and Alaska — where recreational marijuana that requires alcohol distributors to transport marijuana.
“The business owners in this industry have invested hundreds of millions of dollars to build facilities across the state. They have hired and trained thousands of additional employees to meet the demands of the market. Unless the issue with distributor licensing is resolved quickly, the inability to deliver product to retail stores will result in many of these people losing their jobs and will bring this nascent market to a grinding halt. A halt in this market will lead to a hole in the state’s school budget,” Nevada’s tax authority said in its statement.
Nevada voters approved the sale of recreational marijuana last November during the election. Sales started on July 1st, raking in an impressive $3 million dollars during its first weekend according to Nevada Dispensary Association.
But that’s less surreal when you learn that the state tax on marijuana is a whopping 10% sales tax, while growers receive an even higher rate of 15% tax. The revenue is expected to help generate tens of millions of dollars a year for the state government, LA Times reported.
So far this year a total of 29 states and DC have legalized marijuana for medical use according to ProCon.org.