Marijuana Legalization Is A ‘Significant Threat’ To Alcohol Industry Because People Substitute Cannabis For Beer And Wine, Analysis Finds

Financial analysts say they expect the expansion of the marijuana legalization movement will continue to post a “significant threat” to the alcohol industry, citing survey data that suggests more people are using cannabis as a substitute for alcoholic beverages such a beer and wine.

A report from Bloomberg Intelligence (BI) projects that slumping sales of wine and spirits “may extend indefinitely,” which will “stem largely” from the increased consumer access to “legal cannabis,” as well as rising popularity of made-to-go drinks, for example.

They estimated that the combined influence of cannabis access and shifts in consumer demand for certain alcoholic product types accounts for a 16 percent share valuation discount offered by the beverage company Constellation Brands, which owns major brands including Corona, Modelo, Pacifico and Casa Nobel Tequila.

“The use of cannabis among consumers is on the rise, and we believe it’s being substituted for alcoholic beverages” based on an August 21 survey from BI involving 1,000 adults, it said. “We also anticipate that increasing US consumer access to recreational marijuana will be a significant threat to all alcoholic drinks, particularly beer and wine, given their lower price points relative to liquor.”

According to the survey, nearly half of respondents reported using cannabis as an alcohol substitute at least once per week. Additionally, 22 percent said they use marijuana more often than alcohol.

Meanwhile, a multinational investment bank similarly said in a report late last year that marijuana has become a “formidable competitor” to alcohol, projecting that nearly 20 million more people will regularly consume cannabis over the next five years as booze loses a couple million drinkers. It also says marijuana sales are estimated to reach $37 billion in 2027 in the U.S. as more state markets come online.

BBG Intelligence on 🇺🇸 #Cannabis 🌿 pic.twitter.com/xL6Lmhu89h

— Todd Harrison (@todd_harrison) September 6, 2024

Another study out of Canada, where marijuana is federally legal, found that legalization was “associated with a decline in beer sales,” suggesting a substitution effect.

The analyses comport with other recent survey data that more broadly looked at American views on marijuana versus alcohol. For example, a Gallup survey from last month found that respondents view cannabis as less harmful than alcohol, tobacco and nicotine vapes—and more adults now smoke cannabis than smoke cigarettes

A separate survey released by the American Psychiatric Association (APA) and Morning Consult last June also found that Americans consider marijuana to be significantly less dangerous than cigarettes, alcohol and opioids—and they say cannabis is less addictive than each of those substances, as well as technology.

Additionally, a poll released in July found that more Americans smoke marijuana on a daily basis than drink alcohol every day—and that alcohol drinkers are more likely to say they would benefit from limiting their use than cannabis consumers are.

Similarly, a separate study published in May in the journal Addiction that similarly found that there are more U.S. adults who use marijuana daily than who drink alcohol every day.

Another poll released last month found that marijuana use is one of the only crimes that a majority of Americans say is punished too harshly—and bipartisan majorities also back expunging prior cannabis convictions.

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California Lawmakers Approve Bill To Prevent ‘Double Taxation’ Of Marijuana By Local Governments

California lawmakers have given final approval a bill to prevent what advocates call the “double taxation” of marijuana by restricting the ability of local governments to calculate their cannabis levies after state taxes are already applied. The legislation’s sponsor says if the proposal is signed into law it will end what he calls the “collection of a tax on a tax.”

On Thursday, the Assembly unanimously passed the legislation from Sen. Steven Bradford (D) in a 75-0 vote. It would make it so state taxes that marijuana businesses pay wouldn’t be included in the calculus of how localities determine their own local cannabis taxes.

California NORML is encouraging Gov. Gavin Newsom (D) to sign the measure, arguing that marijuana is “already heavily overtaxed relative to comparable goods in California.”

“Compounding taxes simply leads to an artificially inflated purchase price and incentivizes consumers to purchase cannabis from the unlicensed, untested, and untaxed market,” the organization said in a call to action alert.

SB 1059 from @SenBradfordCA would end double taxation of #cannabis at the local level in California. It passed the Senate today!

Please write to Gov. Newsom and ask him to sign SB 1059 into law, at: https://t.co/4cQ5t0qiI7pic.twitter.com/KC3cBVik0v

— California NORML (@CaliforniaNORML) August 29, 2024

A legislative analysis from April included commentary from the author that says the bill, SB 1059, “will assist the legal cannabis industry by alleviating some of the tremendous tax burdens placed on this industry.”

“This bill would eliminate a local government’s collection of a tax on a tax. This calculation method is unfair to consumers, and disadvantages licensed retailers that continue to struggle against a thriving illicit market,” it says. “SB 1059 addresses this issue and ensures taxes are based on the actual goods being sold.”

“In some jurisdictions, including the City of Los Angeles, local cannabis taxes or fees are being calculated after the state excise tax is applied. This is in direct conflict with guidance provided by the [California Department of Tax and Fee Administration]. Additional changes are needed to existing cannabis tax laws, as this conflict between state and local tax regulations makes it impossible for legal operators to properly calculate and remit their taxes.”

—Marijuana Moment is tracking more than 1,500 cannabis, psychedelics and drug policy bills in state legislatures and Congress this year. Patreon supporters pledging at least $25/month get access to our interactive maps, charts and hearing calendar so they don’t miss any developments.Learn more about our marijuana bill tracker and become a supporter on Patreon to get access.—

Meanwhile, California lawmakers also gave final passage to bills last week that would allow small marijuana growers to sell their products directly to consumers at state-organized farmers markets and legalize cannabis cafes in the state.

Also, a state-funded effort is underway to analyze the genetic information of various marijuana strains in order to preserve the state’s rich history of cannabis cultivation. It’s part of a project meant not only to acknowledge the past but also protect the future of legacy growing regions such as the Emerald Triangle.

Separately, a plan from the governor that would have ushered in sweeping changes to the state’s marijuana and hemp markets died earlier this month after a Senate committee did not call the bill for a vote ahead of a key legislative deadline.

The measure would have folded hemp-derived cannabinoid products into the state’s regulated marijuana system and opened the door to out-of-state hemp producers to sell products into California’s cannabis market. It was an attempt to rein in largely unregulated hemp-derived cannabinoid products and smokable hemp flower, but it received sharp pushback from industry groups including Origins Council as well as some medical patients who said they rely on hemp-derived CBD.

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Photo courtesy of WeedPornDaily.

GOP Congresswoman Predicts Marijuana Will Be Rescheduled ‘Right Before The Election,’ But She’s Not Sure If Trump Is On Board

A GOP congresswoman says she expects the Biden administration’s marijuana rescheduling proposal to be finalized “right before the election, because they want the cannabis votes.” And while she hopes former President Donald Trump will back the change, she also said part of the reason Republicans in Congress have declined to embrace marijuana reform is because they’re “afraid of it.”

Rep. Nancy Mace (R-SC), who is sponsoring a bill to federally legalize marijuana called the States Reform Act, spoke about cannabis election politics, rescheduling prospects and more during an interview with The Dales Report on Monday.

Asked about whether she expects Trump will get behind marijuana reform in light of his recent comments indicating support for decriminalization as more states adopt legalization, Mace said she wasn’t sure. But she noted his past comments in favor of medical cannabis and said she “would like to hear support for rescheduling” from her party’s leader, especially considering that there’s a “statistically significant number of Republicans” in favor of those policies.

“There’s a lot of work to be done, and Republicans need to get on board, because the vast majority of Americans are with me, with you guys, on how to move forward in a very responsible manner,” Mace said during the marijuana-focused podcast interview. “I would allow states to decide how they want to regulate cannabis. That should be a thing that states are involved at their level—whether it’s medical, recreational—how they want to implement it. Different states have done it different ways, with some successes and some failures.”

“I think that, in the GOP realm, people are afraid of it,” the congresswoman said. “People are afraid of being primaried, and they they haven’t polled it, because if they polled it, they would see, ‘oh, wow, there’s actually significantly more support for this position than I realized.'”

She added that there are “so many reasons to [back cannabis reform] as a Republican. Not only is it the “right moral thing to do,” but it’s also “a winning electoral issue—it’s like a win-win situation.”

Mace said her colleagues in Congress are largely “clueless” on the nuances of the marijuana policy debate, particularly as it comes to some of the debates that have played out during the rescheduling effort. To an extent, that means it’s partly the responsibility of stakeholders and advocates to bring legislators the data showing how supporting policy reform is a popular political position, she said.

But as far as this year is concerned, Mace only signaled confidence that the Biden administration would complete rulemaking to move marijuana from Schedule I to Schedule III under the Controlled Substance Act (CSA), as the Justice Department formally proposed in March.

Her States Reform Act to federally deschedule cannabis, meanwhile, has “zero” percent chance of advancing in the GOP-controlled House in the next three weeks, Mace said, noting challenges with the calendar and other legislative priorities.

“Right now, a good effort would be, between now and the end of the year, is I want to educate members about States Reform Act and then ask them to cosponsor it—showing that we can have a growing level of support,” she said.

. @RepNancyMace will be joining us at a special time tomorrow to talk about the current landscape of #cannabis and #hemp in Washington D.C.

This is going to be a can't miss stream. See you all there! $MSOS$MSOXhttps://t.co/aPAeO6FEvm

— The Dales Report (@TheDalesReport) August 25, 2024

She also mentioned that, if rescheduling is ultimately enacted, her legislation will likely be amended ahead of its reintroduction next year. She didn’t provide details on how it might be changed, however.

In April, Mace said in a separate interview with The Dales Report that “if Republicans want to keep the House,” they should pass a marijuana banking bill, arguing that “there are votes” to approve it. She also said it’s “mind-boggling” that Virginia’s GOP governor had vetoed a bill to legalize cannabis sales given the issues’s broad bipartisan popularity.

The congresswoman also weighed in on another controversial development from earlier this year: guidance from a GOP policy committee she sits on that specifically urges members to oppose the SAFE Banking Act and the Cannabis Users’ Restoration of Eligibility (CURE) Act she’s sponsoring on marijuana-related security clearance denials.

“I just, I don’t understand. We don’t need it. We need to move forward, not backwards,” she said of the GOP leadership’s opposition to cannabis reform. “We need to go with where the country is.”

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