As China and the U.S. exchange blows in an all out trade war, many products, including the vape pens that we use for cannabis oil, will face taxes of up to 25 percent. While there are different ways for companies to deal with the financial blow about to be dealt, the most likely outcome is that consumers will be the ones absorbing the expense.
Another option is vape companies themselves absorbing the cost of the additional tax to remain competitive, but the profit margin on pens isn’t going to always be broad enough to justify said absorption. Thus, a price hike could be seen in the near future.
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Thirty states and the District of Columbia have either implemented medical or recreational laws to protect cannabis imbibers from punitive penalties. Since then, a new market has opened up and one of its best sellers is the vape pen.
Vape pens are amazing in many ways. First of all, they look like e-cigs and have little to no odor, so they’re stealthy and ready to come with you to an outdoor concert, walking around the neighborhood, taking a hike or even flying because they themselves fly right under the radar.
There’s no telling what a price increase will do to the vaping market, but if prices do go up there’s bound to be some grumbling at the very least. It’s doubtful people will put down their pens due to the additional tax, but it’s an expense that patients especially don’t need.
Estimates are that by 2020, the cannabis industry will be pulling in $20-$30 billion dollars. When vaping devices and other parts and pieces that relate to the cannabis industry are factored in, they will contribute to a kushy tax revenue for Chinese importers.
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At least it can be said that the product that goes into cannabis pens – ones with THC in them and some CBD ones as well – is grown and manufactured in the U.S., where the oil will only be subject to the taxes already implemented. California, however, is already facing challenges keeping up with projected growth and profit, so the trade war could affect their economy, the fifth largest in the world, the most.
Unfortunately, the compassionate care program is already greatly impacted by high California taxes on seed to sale cannabis. Which is to say all of their cannabis, as every bit of marijuana is now accounted for from the time of embryo to fruition and taxes apply at every stage. Just another reason why the latest Trump moves in the China/U.S. trade wars really stink – and not in that good, skunky way, at all.