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How Much Public Revenue Would Cannabis Legalization Generate In Germany?

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Germany is home to the largest legal medical cannabis market on the European continent. That is not surprising considering that Germany is home to the fourth-largest economy on the planet behind only the United States, China, and Japan.

Until recently, Germany imported more medical cannabis products than any other country and it was only recently that the country was passed on that front by Israel.

Part of that is due to the rise of domestic production in Germany and it’s also partly due to ongoing issues in Israel that have resulted in a spike in their medical cannabis imports.

It’s likely a safe bet that adult-use legalization in Germany would be huge. Germany is a massive domino and when it falls, the public policy repercussions will be felt throughout Europe and beyond.

A lingering question regarding adult-use legalization in Germany is how much money would such a public policy change yield for public coffers in Germany?

A recent study provides an answer to that very question. Excerpts about the study below, via Reuters:

Legalising cannabis could bring Germany annual tax revenues and cost savings of about 4.7 billion euros ($5.34 billion) and create 27,000 new jobs, a survey said on Tuesday as politicians thrash out rules for the budding sector.

The survey by the Institute for Competition Economics (DICE) at the Heinrich Heine University in Duesseldorf, and commissioned by the German hemp association, found that legalising cannabis could lead to additional tax revenues of about 3.4 billion euros per year.

At the same time, it could bring cost savings in the police and judicial system of 1.3 billion euros per year while creating tens of thousands of jobs in the cannabis economy.

Those numbers are very encouraging, and lead to the next logical question – when will Germany legalize cannabis for adult use? Germany legalized cannabis for medical use in 2017.

Earlier this month Bloomberg broke the news that a legalization coalition in Germany is gaining momentum and that the drafting of a strong legalization measure is nearing completion. Per Bloomberg:

Germany’s likely next ruling coalition is closing in on a deal to legalize cannabis for recreational use, the strongest signal yet that long-awaited growth of Europe’s marijuana market is gaining traction.

Negotiators for the Social Democrats, Greens and pro-business Free Democrats are hammering out the details, including conditions under which the sale and use of recreational cannabis would be allowed and regulated, according to people familiar with the talks, who asked not to be identified because the discussions are private.

At this point, it’s not a question of if Germany will legalize cannabis for adult use, it’s a question of when. Whether this latest measure passes or not, some type of legalization measure is going to pass sooner rather than later in Germany.

Luxembourg has already announced plans to legalize cannabis for adult use in 2022, and Italy also appears to be on a path to legalization in the near future. Countries like Switzerland and the Netherlands have adult-use pilot programs ramping up.

It’s very unlikely that lawmakers in Germany are going to sit by and see other countries reap the benefits of legalization. As we now know from the study cited in this article, there’s way too much money being wasted on prohibition and too much potential profit potential to keep prohibition in place.

The excitement in Germany is enormous, and support for cannabis reform and the emerging cannabis industry grows every day throughout Europe. Join us in Berlin in July 2022 at our flagship conference to get in on the action.

Our conference in Berlin is the largest cannabis industry B2B event on the European continent and the July 2022 conference is going to be the one biggest yet. To find out more info click here.