Australia to Vote on Recreational Use Bill
The Australian Parliament will vote on a bill to legalise recreational cannabis use for adults on November 27, 2024. The Australian Green Party is backing the measure.
"The bill, introduced in the upper house in August 2023, would allow adult-use recreational use and pave the way for legal home cultivation of up to six plants and a commercial cannabis market" Cannabiz, local news coverage.
If the bill is passed then it would mean that the Cannabis Australia National Agency would have the statutory power to register strains and regulate cannabis-related movements. They would also be responsible for the cultivation and possession of cannabis plants, the manufacture and sale of cannabis products, the operation of cannabis cafes, and the import and export of cannabis products.
Locally a recent parliamentary report released in the state of New South Wales calls for cannabis reform. The report, raised by the Prime Minister and the Finance Committee, describes cannabis reform as "the only sensible course of action."
In the Australian Capital Territory, home to the country's capital, cannabis has been decriminalised since January 2020, however driving whilst under the influence of cannabis remains prohibited, as does trading cannabis and consuming it in public. At the federal level, cannabis remains banned in Australia, although medicinal cannabis is legal in some cases.
What Would be the Economic Impact of a Legalised Australian Market?
The Australian Parliamentary Budget Office (PBO) have made calculations that a legalised domestic adult-use cannabis market could have the potential to yield $28 billion in tax revenue in just ten years. However, researchers believe that this estimate is too high and by taking current patterns of cannabis use into consideration, $13 billion is a more realistic estimate."
It has been estimated that a legal market could tempt 3.4 million cannabis users in its first 12 months. Figures show that Australia currently consumes 441 tonnes of cannabis per year. Researchers report that the "Parliamentary Budget Office assumes a price of $16.95 per gram, of which $3.55 would be tax - 10% GST and 15% excise duty". Meanwhile, the Australian Criminal Intelligence Commission (ACIC) have arrived at a different figure, estimating that a gram would cost around $22.50.
However, it has been pointed out that the estimated tax revenue is based on a retail price of $12 per gram, of which $2.51 would be taxed. These figures have been used to arrive at the $13 billion figure.
"The Australian legal cannabis market was valued at $66.0 million in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 29.6% from 2023 to 2030," Grand View Research on Australia's emerging cannabis industry.
However, as it stands the majority of the Australian population is not on the side. In a July poll, only 41% of respondents voted in favour of reform.
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Liz Filmer
