Figures obtained by the Greens from the Parliamentary Budget Office show that the legalisation of Cannabis would generate more than $28 billion in government revenue in the first decade after legalisation. This comes from GST, company tax and a 15% cannabis sales tax. With a 25% cannabis sales tax the revenue would surge to over $36 billion.
The modelling for the Greens shows that creating a legal market would see illegal cannabis sales collapse to just 5% of all sales in the first five years of operation, removing billions of dollars from organised crime. It also assumed at least 10% of the consumption under the scheme to be from people coming from overseas, hinting at the financial boon that a cannabis tourism market could have for the country.
The cost savings in the PBO costing do not include the very significant savings from policing, courts and jails at a State-level from reduced cannabis policing.
With the $26 billion generated from legalised cannabis it would be possible to undertake serious social justice measures such as:
- Raise the rate of job seeker and youth allowance [by $80 a fortnight], or
- Build more than 88,000 additional public housing units over the next decade to give 250,000 people a home.
Even more could be achieved with the $36 billion from the higher 25% cannabis sales tax.
In 2022 the Greens announced a plan to legalise cannabis nationally through the Federal Parliament.
Greens Senator and Justice Spokesperson David Shoebridge said:
“We know that legalising cannabis reduces harm by keeping people out of the criminal justice system, this report shows how it will also bring in tens of billions of dollars of public revenue as well.
“With the revenue generated from legalised cannabis we can build new public housing for a quarter of a million people or lift JobSeeker by $80 a fortnight. This is an opportunity for some serious investment in social justice.
“When we legalise cannabis we take billions away from organised crime, police and the criminal justice system and we can then spend it on schools, housing, hospitals and social support.
“The Greens model creates a right for adults to grow up to 6 plants at home without being taxed and without having to pay. This costing takes that into account.
“It also guarantees commercial possibilities for co-operatives and local entrepreneurs to grow and sell cannabis including through regulated cannabis cafes.
“The costing assumes 10% of the cannabis sold under the scheme would be sold to tourists, with the potential this could grow. This green gold could become the life blood of many regional areas currently struggling for viable local industries.
“The community has been waiting decades for cannabis legalisation. It’s time for the Parliament to catch up and this costing provides another 28 billion reasons to get on with it,” Senator Shoebridge said.
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