How The Cannabis Industry Changed Las Vegas
It has been over four years since recreational adult use became legalized in Nevada. And while many new markets have entered the city since then, nothing has had quite the heavy impact as the Las Vegas cannabis industry. From job creation, tax revenue, cannabis tourism, and even withstanding a global pandemic, the Las Vegas cannabis industry has proven to be a resilient and integral part of the city.
The Journey to Legalization
As the saying goes, “Hindsight is 20/20.” While it seems obvious how beneficial the cannabis industry has been, the road to legalization wasn’t so easy. Although Nevada is known for “indulging in the taboo,” it took a long time before the first medical and recreational sales. The state was ahead of the curve when it came to initiating a medical marijuana act in 1998, but it wasn’t until 2013 when commercial distribution was made possible. Even after this 15-year long wait, the state was slow to approve retail licenses. Because of this, it wasn’t until July 31st, 2015 when Nevada’s first medical marijuana dispensary opened.
Only a year later, on November 8th, 2016, Nevada voters passed an act to legalize recreational adult use. Within months, on New Years Day 2017, adults 21 years or older could begin purchasing from recreational dispensaries – making it the fastest turnaround from the ballot box to retail sales in the nation.
Cannabis Tourism in Las Vegas
The introduction of cannabis to Las Vegas added a new allure for the millions of tourists that visit the city each year. Along with the world-renowned entertainment, coveted restaurants, and fast-paced nightlife, travelers can now enjoy another facet that the city has to offer: cannabis tourism.
Since recreational marijuana was legalized, tourists have helped the Las Vegas cannabis industry grow to over $2.4 billion. And just like everything else in the entertainment capital of the world, the Las Vegas cannabis industry has a “go big or go home” approach. From cannabis tours in a Mercedes G-Wagon to the world’s largest dispensary, the cannabis market here has definitely received the Vegas touch. Because of this, the Las Vegas cannabis industry has still grown, even as more states legalize recreational use.
The latest attraction is the legalization of cannabis consumption lounges. In June 2021, Nevada passed a bill that would allow alcohol-free lounges where adults can purchase and smoke cannabis products. Previously, the law stated that cannabis products can only be consumed on private property. This meant smoking in hotels, casinos, or nightclubs – where tourists spend a majority of their vacations – was illegal. The new law would make partaking in cannabis even more convenient – potentially driving more tourist traffic. Cannabis lounges will officially become legal on October 1st, 2021, and we can expect them to open as early as the end of 2021.
It should also be noted that tourists aren’t the only ones to thank for growing the cannabis market in Las Vegas. Even when tourism significantly dropped in 2020 due to COVID-19, marijuana sales skyrocketed. Local support throughout the pandemic was massive, and many saw cannabis as a necessary tool to help cope during tough times.
Cannabis Industry Jobs in Las Vegas
The more the Las Vegas cannabis industry grows, the more local jobs are created. From seed to sale, getting cannabis products ready for consumers requires multiple steps. Places like cultivation sites, laboratories, packaging facilities, and dispensaries, all require employees to help get the job done. Even indirectly, many jobs opened for cannabis marketers, graphic designers, product designers, etc. It’s estimated that there were 13,000 jobs created as a result of recreational adult use.
Cannabis Tax Revenue in Nevada
One of the biggest reasons for support of recreational adult use was the additional tax revenue. In Nevada, adult use retail purchases are taxed a 10% cannabis excise tax, plus the 4.6% statewide sales tax. This helped generate an additional $70 million for the state to use in its first year of legalization. And that number has been gradually increasing year after year, even with the pandemic. From 2020 to 2021, the tax revenue increased about 10% – which doesn’t even include the full 2021 fiscal year. From its first year of legalization, there’s been a 65% increase.
So, where does the money made from cannabis tax revenue go in Nevada?
In short, most of the money goes towards the state’s emergency fund and education. Originally, Nevada was only using revenue generated on wholesale marijuana tax (15%) to go towards Nevada’s Distributive School Account (DSA). This equaled about $27 million in 2018. From that sum, roughly 80% went to employee salaries and benefits. The other 20% helped cover transportation, utilities, and school supplies. Most recently, however, lawmakers proposed moving all money collected from the marijuana tax to go towards education. In the governor’s budget for 2021-2023, this same idea is echoed. This would be over $100 million going to help Nevada’s education system.
While many were uncertain about the cannabis industry prior to legalization, it’s clear its impact has been greatly beneficial. As the cannabis market grows, the city grows with it.
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