What’s Driving Pot Consumers to ‘Underground’ Markets in WA?

According to reports, including data released by The Center Square, for the first time since recreational pot became legal in WA, revenue is down.

Pot sales drop about $120 million in 2022

According to information released by Headset, which is a cannabis data firm, and from The Center Square, pot sales dipped 8 percent in WA. It's the first time there's been a downturn since recreational marijuana went on the market in 2014.

That figure amounts to about $120 million, according to the reports. Is it due to COVID hangover?  Some experts believe the health and financial struggles of people during the pandemic cut into sales, and the after-effects linger.

However, according to information from The Center Square, it's not just a WA issue. The Center Square says, according to the National Cannabis Industry Association, inflation is driving more consumers to 'underground' producers, or referred to by some as the black market.

WA state has the highest excise tax in the nation on recreational pot, at 37%. An excise tax is a legislatively or government-imposed tax on a wide variety of items, from tobacco and alcohol to fuel, etc.

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This would explain why despite recreational pot, even before COVID, law enforcement was still discovering and breaking up large-scale illegal pot-growing operations. In 2019, several were raided in Franklin County and other areas.

  Recently, a Port Angeles grower and processor was shut down by the state over alleged illegal activity pertaining to their cannabis operations.

It does appear that inflation, coupled with high excise taxes, are eating into pot sales and state profits.