Colorado High on Marijuana Revenue—Billion-Dollar Industry to Bring State More Than $100 Million in Annual Taxes
The legal sale of marijuana in Colorado is bringing a new kind of high to state officials.
In a budget proposal released February 19, Colorado Gov. John Hickenlooper anticipates the state will collect about $134 million in taxes, according to The New York Times. Much of the money is expected to go toward substance abuse and public health programs.
“This package represents a strong yet cautious first step toward ensuring a safe and responsible regulatory environment,” Hickenlooper wrote in the proposed budget.
The state of Washington, which last year authorized the sale of marijuana for recreational use beginning in June 2014, expects a similar windfall. That state’s officials are planning to collect about $190 million in taxes in the four years beginning in mid-2015, according to the Times.
Critics of legal marijuana say it’s too early to begin celebrating. They say that increased regulation and law enforcement costs could eat away at any increased revenue.
But members of the U.S. House of Representatives have taken note of the possibility of bringing in more money by taxing pot sales on a federal level. A bill was introduced last year that would decriminalize and tax marijuana to help pay for substance abuse programs as well as take a bite out of the national debt. The “Ending Federal Marijuana Prohibition Act of 2013” has been sitting in a subcommittee since then.
Colorado’s windfall was underscored February 20, which was the first day businesses selling marijuana were required to make tax payments. Although the federal government recently relaxed rules that kept some such businesses from using banks, many of the payments were made in cash. Patients Choice, which is a chain of dispensaries, brought about $140,000 under guard to pay various state agencies, according to the Times.
To Learn More:
Colorado Expects to Reap Tax Bonanza From Legal Marijuana Sales (by Jack Healy, New York Times)
Colorado stash: $184M in marijuana taxes (by Aaron Smith, CNN Money)
Marijuana Industry Begs to be Taxed (by Noel Brinkerhoff, AllGov)
Taxing Marijuana Would Earn California $1.4 Billion (by Noel Brinkerhoff, AllGov)
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