Wholesale Flower Sold in Alaska Taxed at Highest Level in United States
The Alaska Department of Revenue (ADOR) recently posted information on tax collections from the wholesale side of the state’s adult-use cannabis industry for July 2019. According to the state’s data, total tax revenues expanded in July on increased volume of flower traded by the state’s growers. However, year-over-year increases in trading volumes in July decreased relative to those for the month prior. Alaska’s monthly average Spot price was down in July compared to June.
The tax collection figures from ADOR state that licensed growers paid a total of $1,835,068 in tax to the state in July. Receipts from the levy on cultivators increased by 3.6% month-over-month, relative to $1,771,949 collected in June.
July saw 1,544 pounds of flower change hands in the state’s market, up by 2.1%, compared to the 1,512 pounds traded in June. Flower sold or transferred by Alaskan growers is taxed at a flat rate of $50 per ounce ($800 per pound).
The volume of trim traded in July was 1,359 pounds, representing a decrease of 4.8% from June’s total of 1,427 pounds of trim sold by cultivators. Wholesale sales volume of trim in January 2019 still represents the highest monthly total of such plant material moved in the state’s market at 1,532 pounds. Trim is taxed at a rate of $15 per ounce ($240 per pound) in Alaska’s market.
682 pounds of “immature/seedy/failed” plant material was transferred or traded by growers in July, up by 24% from 550 pounds in June. “Immature/Seedy/Failed” plant material is taxed at a rate of $25 per ounce ($400 per pound) and was only introduced as a taxable product category at the outset of this year.
The volume of flower and trim that changed hands in July 2019 saw significant increases compared to the same month the year prior. In July 2018, 1,388 pounds of flower and 1,086 pounds of trim were traded or transferred in Alaska’s licensed system.
July 2019’s trading volumes for those product types represent year-over-year rises of 11.2% and 25.1%, respectively. The magnitude of year-over-year increases in wholesale sales volume in July 2019 decreased notably from the month prior, especially for flower.