California brought in $130 million in cannabis tax revenue during the third quarter of 2022, a $100 million drop compared to the same period last year, POLITICO’s Alex Nieves reports. Regulated sales are shrinking as licensed businesses struggle to compete with a booming illicit market. It was the first quarter since lawmakers eliminated the cultivation tax in July to ease burdens on producers, but that doesn’t explain the drop in excise tax revenue. More context: As the California market struggles with competition from unlicensed operators, which don’t face any taxes or heavy regulatory burdens, industry observers are worried that a similar situation could unfold in New York, where unregulated sellers have proliferated.
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