FIRST AIRED: June 25, 2018

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00:00:01
>> The legalization of recreational marijuana in California this year was meant to bring the drug out of the dark and into the open. But half a year in, industry experts say, surprisingly high taxes are giving some consumers sticker shock and sending them back to the black market.>> My husband has restless leg syndrome and he had to stop buying it here he bought it all the time and had to start growing his own because he we couldn't afford for him to do it anymore.
00:00:29
It was too much.>> Too much money.>> Debbie Goldsbury has been running this dispensary in Oakland for the past 5 years and says on average it costs her customers about 25 to 30% more now than last year.>> We've had a lot of attrition in membership. Right after January 1st, medical marijuana patients just kinda fled the dispensary system because they can get cannabis cheaper from their friends or cheaper on the streets.
00:00:52
Or they can go straight to a cultivator who doesn't have a license to supply a dispensary.>> Henry Wykowski is general counsel to the National Cannabis Industry Association, his rough back of the envelope calculation of cannabis tax on an ounce of cannabis flower that costs $75 on the wholesale market, is about $32 add the sales tax and that's around $41.
00:01:16
>> So it's pretty expensive proposition right there.>> California's first quarter pot taxes were a mere $34 million according to the legislative analyst office. And while it could pick up in the second quarter, it's much less than expected.>> They need to go back and examine why that is lower than they anticipated.
00:01:36
And I think that what they'll find is, is that by taxing it too heavily, they have not encouraged people to come into the regulated market as quickly as they had hoped.>> California's lawmakers in March proposed a Bill to lower Cannabis taxes but that Bill has recently died.
00:01:53
And assemblyman Rob Bonta, a co-author of the Bill told me, some in the government wanted to give it more time to see how the taxes would impact the industry over a longer period. But he believes it's a missed opportunity to get the California cannabis industry out of the black market.