Puerto Rico Treasury foresees millions in revenue from medicinal cannabis
SAN JUAN – Treasury Secretary Raúl Maldonado Gautier foresees millions of dollars in revenue from the recently created medicinal cannabis industry in Puerto Rico, which could pull the island out of its fiscal crisis.
The Treasury official made the assertion during a routine visit to medicinal cannabis manufacturer and dispensary NextGen Pharma in Toa Baja’s urban center.
However, during joint public hearings between the Senate Federal, Political & Economic Relations Committee, headed by Senate President Thomas Rivera Schatz, and the House Judiciary Committee, presided by María Milagros Charbonier, to evaluate Senate Bill 340, which would create the legal base for the industry, Treasury Deputy Secretary Francisco Parés Alicea said that ever since the industry became operational on the island, in June, the department has barely collected $100,000 from the sales and dispensing of medicinal cannabis.
Despite this modest estimate, Maldonado Gautier affirmed that, once established, the industry would generate much more revenue.
“Collections may fluctuate, depending on how fast the industry moves; between $30 [million] and $60 million in sales & use tax [IVU by it Spanish acronym] alone. Other collections, which are those directly on tax revenue, depend on the number of jobs. Indirect jobs are very high, so we believe it may reach up to $100 million annually,” he said in a press conference.
When questioned about the relatively low numbers revealed by his deputy during the hearings, the Treasury official explained that the reason the industry has generated such low collection numbers is because it just started. However, Parés Alicea didn’t make that clarification during his remarks before the legislators.
“The issue is that this is an industry that has barely begun. We are looking at projections with respect to offer and demand. We believe this industry’s growth potential in Puerto Rico is excellent, and that isn’t speculation. We looked in detail at what happened in states in the United Stated where this industry exists, and we believe that because of the market’s nature, the industry will have a great impact on Puerto Rico, both on jobs and collections,” Maldonado Gautier said.
He assured that his agency won’t create an additional tax system to deal with collections originating from the medicinal cannabis industry. Maldonado Gautier said the government will use the same system applied to other businesses.