Could Legalizing Marijuana Help Close the Budget Deficit?


New York is facing an approximate 14 billion dollar budget deficit after the state lost billions in tax revenue and from fighting the coronavirus. 

Now the question remains…if federal aid does not arrive, does the state look for ways to raise revenue or cut services?

The Governor has said it would mostly likely be a combination of the two. 

But now local governments are coming up with creative ways to raise revenue, even recently suggesting a cannabis cultivation tax as a way to offset lost revenue. 

Assembly Majority Leader Crystal Peoples-Stokes who has carried a bill to legalize recreational marijuana for 6 years, says it is still an uphill battle to get this passed. 

“I think that the legislature is going to be looking at revenue raisers,” Assemblywoman Peoples-Stokes confirmed. “They should’ve always been looking at this as a revenue raiser. And I think this is closer to getting done then it has been in the past.”

Although most legislative leaders have voiced support for legalizing recreational marijuana, like most decisions it all comes down to money. 

Experts estimate that New York could generate around $300 million in tax revenue. 

Assemblywoman Peoples-Stokes says her bill would make sure that 50% of tax revenue from cannabis sales would go to neighborhoods that have been disproportionally affected by marijuana being illegal. 

But she says, she is willing to negotiate. 

“As long as people are willing to continue with the intent of the legislation, that there is a set aside (amount of tax revenue) by law that will go into these communities I think we can get it done as long as people don’t wanna move away from that,” Peoples-Stokes explained. 

However Dr. Kevin Sabet, President of Smart Approaches to Marijuana and former White House drug policy advisor, warns against using revenue gained from recreational marijuana as a way to close the state’s deficit, pointing to costs associated with enforcement and implementation. 

“It would cost the state money to implement the program,” Dr. Sabet said. “These programs them selves have massive administrative costs. And also by the way, it’s against federal law so you’re not gonna have any help from the federal government, you’re gonna be violating federal law.”

Dr. Sabet also said that in light of the global pandemic, there are also health concerns associated with legalizing cannabis. 

“During a global pandemic the last thing you wanna do is encourage some thing that’s bad for your lungs and your respiratory system during a respiratory pandemic,” Dr. Sabet explained. “That doesn’t make any sense.”

Regardless, Peoples-Stokes says they are still ten lawmakers away from getting the bill legalizing recreational marijuana to the floor to a vote. 

“Now am I willing to negotiate? Government is the art of compromise,” Peoples-Stokes said. “I can talk compromise but so far I haven’t had the opportunity to talk that compromise with the second floor.”

According to the Massachusetts Cannabis Control Commission, last year, the first full year of legal marijuana sales for which data was available, dispensaries conducted $420 million in business resulting in $71 million in tax revenue for the Commonwealth.

The Vermont State legislature also recently passed a bill legalizing cannabis and the bill currently waits for the Governor’s signature. 

And people in New Jersey will get the chance to decide for themselves in November and will have the opportunity to vote on an amendment legalizing marijuana. 



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