This story was republished with permission from Crain’s Chicago Business and written by John Pletz.
Jim Belushi, the actor and comedian whose latest role is gentleman cannabis farmer and entrepreneur, says he gave Gov. J.B. Pritzker a friendly nudge about taxes on weed.
The state tax rate has long been a hot topic in the weed industry, and Belushi addressed it during the Cannabis Innovation Summit yesterday at startup incubator 1871.
“I had a conversation with Gov. Pritzker, who I really think is on our side. He’s a good guy,” Belushi said. “I said, ‘Last year, you guys collected $417 million in cannabis taxes, and you collected $207 million in liquor taxes. There’s a lot more liquor stores and bars than there are dispensaries.’”
Illinois has some of the highest pot prices in the nation because it has kept a tight lid on the number of retail licenses compared to states such as Michigan. Illinois also has some of the highest taxes on marijuana, approaching 40%, depending on the potency of the product. Michigan charges 16%, and Missouri’s tax rate is 10.2%.
Illinois cannabis sales are picking up as more stores open. Recreational marijuana sales hit $148.9 million in March, up 10% from a year earlier and the highest monthly total since December, which is typically the industry’s strongest month of the year, followed by July. The number of products sold in March was up 11% from February, the Department of Financial & Professional Regulation said. Out-of-state sales have leveled off.
Missouri, which began recreational marijuana sales last year, reported $108.7 million in March sales. Michigan reported record sales of $286.8 million last month. Both states have more dispensaries than Illinois, and some Michigan growers and sellers are struggling to stay afloat.
Belushi, who grew up in Chicago and Wheaton with his brother John, was an early player in the newly legalized market for marijuana. His company, Belushi’s Farm, sells marijuana under the Blues Brothers and other brands in about 30 Illinois dispensaries.
Despite the taxes, Belushi said Pritzker and Illinois got it right in setting up the legalized market.
Belushi also said President Joe Biden’s effort to reschedule marijuana, moving it out of the most restricted class of controlled substances, will be a major boost for the industry. “If deregulation happens, we’re going to have another boom. I think regulation and taxation will come down a little bit and make it more competitive” with the illicit market.
