Spanish Cannabis associations estimate that their regulation would generate between 200 and 600 million euros in taxes

Spanish Cannabis associations estimate that their regulation would generate between 200 and 600 million euros in taxes

Eldiario.es reports… The federation that represents cannabis venues throughout Spain  insists on the need to end the legal limbo in which some 1,500 establishments  now operate

They write…

The regulation of the activity of cannabis associations could generate between 200 and 600 million euros only in direct and indirect taxes, according to a study carried out by the Confederation of Federations of Cannabis Associations of Spain (CONFAC). The report, which numbers about 1,500 stores of this type that are scattered throughout the country, insists on the need to organize an activity that during the last decade has settled in most Spanish cities without having a law that protects them.

The pandemic has highlighted the need to abandon this irregular situation both for recreational and therapeutic consumers – many of them were unable to access the substance during confinement – and for the workers in these spaces, who being a good part of them In an irregular situation, they have not been able to access ERTES or other state aid. The sector estimates that today about 7,500 people work in cannabis associations, estimating five employees for each location. 

The CONFAC report is the estimate made by the sector of the volume of taxes that it could generate if its activity were to leave legal limbo and are the numbers that have been transferred to Podemos, which maintains regular contact with these associations and finalizes a bill. to comprehensively regulate both the medicinal and recreational use of cannabis, according to Público . 

Podemos’ bet still does not have the endorsement of the PSOE although sources of the purple formation consulted this Monday were optimistic about the progress in the talks and are confident that a joint proposal will be achieved during this term. “The feelings are good although the circumstances [the management of the pandemic] hinder progress,” these sources pointed out, recalling that the involvement of the Ministry of Health and other departments is necessary. 

The CONFAC study considers different scenarios and indicators that make the income forecasts oscillate. As it is not a regulated market, it is difficult to make precise calculations because many associations are not part of any official federation nor do they reveal the number of active members they have. Others directly take advantage of this associative model to establish illegal marijuana sales businesses and distance themselves from any contribution to change the situation.

To calculate the number of cannabis smokers in Spain, the study is based on the 2019 EDADES report -prepared by the National Plan on Drugs with data from 2017- which estimates that around 10.3 million Spaniards used cannabis during the last year or on a regular basis.

Taking these numbers into account, CONFAC estimates that more than 106 million euros could be collected in personal income tax and Social Security contributions alone. The most optimistic calculations – which estimate that the number of stores would triple if their activity were regulated – increase these revenues to almost 295 million euros as the sector would go from the current 7,500 jobs to more than 20,000. The entity considers these figures prudent since they are made calculating that they would dispense cannabis to 30% of users because many would continue to choose to buy the substance on the black market at first.

Regarding VAT, the study estimates that between 110 and 306 million euros would be paid. These numbers, however, are based on the fact that regular cannabis users consume between 300 and 600 grams per year, a fairly high amount that many daily users do not usually reach.

The report also contemplates other income for the treasury that would be obtained from taxes on premises rentals (between 2 and 5.7 million euros), registration fees for associations in a hypothetical regulatory body (between 187,500 and 520,000 euros) , expert opinion and activity license fees.

From CONFAC, however, they consider that economic benefits should not be the main reason for regulating the activity of these associations. “Public health, citizen security and human rights should be the main reasons to end this situation,” says Ana Afuera, spokesperson for the entity. 

These entities consider that regulating their situation would make it difficult for minors to access the substance and reduce their consumption, allow traceability and a better analysis of cannabis that would prevent its adulteration and facilitate that users have better information about its risks and damages. In turn, they insist that a juicy pie would be snatched from organized crime and would mean significant savings in judicial and police expenses.

According to a survey by the Center for Sociological Research (CIS) from November 2018, 87% of the population is in favor of regulating cannabis for medicinal use while 47.2% of those surveyed supported that it be sold for recreational use in controlled establishments and under certain conditions. 41.6% were against this possibility.

Source: https://www.eldiario.es/catalunya/asociaciones-cannabicas-calculan-regulacion-generaria-200-600-millones-euros-impuestos_1_6235596.html

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