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Colo. Earns $3.5 Million in Marijuana Taxes

By Jeralyn, Section Colorado News
Posted on Mon Mar 10, 2014 at 09:47:22 PM EST
Tags: marijuana reform (all tags)
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The Colorado Department of Revenue released the January, 2014 sales tax figures for marijuana today.

The state took in $2.9 million in sales and excise taxes and another $600,000 in licensing fees, for a total of $3.5 million.

The state distributed $2.1 million of the sales tax to county and local governments. Denver received the lion's share. The actual numbers are here. [More...]

  • 15 percent excise tax: $195,318.
  • 10 percent excise tax: $1,401,568.
  • 2.9 percent retail marijuana sales tax: $416,690.
  • Medical marijuana fees: $496,361.
  • 2.9 percent medical marij. sales tax: $913,519.
  • Retail marijuana fees: $96,300.
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    Colo. Earns $3.5 Million in Marijuana Taxes | 38 comments (38 topical)

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    Been watching "Weeds" (4.00 / 0) (#11)
    by Amiss on Wed Mar 12, 2014 at 01:09:34 PM EST
    on CNN. I don't know, but they were buying medical pot, and were having to be a resident. If so, they are reporting selling out of state?

    afaiu... (5.00 / 1) (#12)
    by kdog on Wed Mar 12, 2014 at 02:59:26 PM EST
    they can't sell out of state, but a lot of people from out if state came to CO to buy their first bag of legal recreational reefer plus tax.

    I predict that novelty will wear off quickly, and residents of neighboring states will go back to their local black market sources.  Tax collections will probably come down from the January numbers.

    And disgruntled prohibitionists should be thrilled by this, that'll show that usage isn't skyrocketing just because it's legal, like worry-warts have always feared would happen with legalization.    

    Parent

    I am surprised a business model that was so recent (2.00 / 1) (#1)
    by oculus on Tue Mar 11, 2014 at 12:13:24 AM EST
    illegal is now so law-abiding re paying taxes.

    the medical marijuana businesses (none / 0) (#2)
    by Jeralyn on Tue Mar 11, 2014 at 03:07:09 AM EST
    have been paying sales taxes in Colorado for some time. It's just the recreational sales that are new. Since recreational licenses are limited to existing medical marijuana businesses (this will continue until late in 2014 if I remember correctly), the businesses are quite familiar with filing tax returns.

    Parent
    The Gov projected tax revenues of (none / 0) (#3)
    by leftwig on Tue Mar 11, 2014 at 09:58:22 AM EST
    $133M+ in the first year ($11M+ a month).  He also stated that they would use $85M of those revenues in the first two years to cover youth prevention education and addiction treatment.

    I imagine sales will pick up, but given the month of Jan. numbers, the tax revenue generated will just about cover youth prevention and addiction treatment costs.

    From the story (none / 0) (#5)
    by Yman on Tue Mar 11, 2014 at 07:41:41 PM EST
    The state says 59 businesses filed a return for the Department of Revenue's report. The state's initial projections were based on assumptions about 40 businesses, however only 24 were actually approved to operate on Jan. 1.

    "The first month of sales for recreational marijuana fell in line with expectations," said Department of Revenue Executive Director Barbara Brohl said in a statement. "We expect clear revenue patterns will emerge by April and plan to incorporate this data into future forecasts."



    Parent
    Clearly their "expectations" before (none / 0) (#6)
    by leftwig on Wed Mar 12, 2014 at 07:33:20 AM EST
    legalization occurred and after actually receiving tax receipts are different.  They actually say that in the quote provided with the excuse that not as many businesses were operable as expected.

    The numbers could very well change as time passes, but Jan. receipts were not close to what was projected.

    Parent

    Clearly they gave no ... (none / 0) (#7)
    by Yman on Wed Mar 12, 2014 at 07:49:41 AM EST
    ... projection for January, and using a monthly average of the annual projection is misleading, given that businesses were just getting started in that first month.

    Parent
    As menmtioned by Jeralyn, most of these (none / 0) (#8)
    by leftwig on Wed Mar 12, 2014 at 08:32:47 AM EST
    businesses were already established as they had been selling medical marijuana for years.  

    From a business model perspective, I could make an argument either way on Jan sales (that it should have been one of the best months or that it would require time to ramp up).  Making a statement either way would be premature, but assuming it to be "average", then projections were off significantly.

    Parent

    Just had a chance to look at some (none / 0) (#10)
    by leftwig on Wed Mar 12, 2014 at 09:46:46 AM EST
    figures.  Retail sales were $14M for Jan with an article from HuffPo stating that the first week netted almost $5M, so sales dropped fairly significantly from the first week.  Retail sales have been projected to be $610M for fiscal year 2015 which would require sales of $50M per month.  Add in that Bloomberg's article mentioned half of the sales went to non-residents, my guess would be that monthly numbers aren't likely to pick up much.

    Parent
    And therefore? (none / 0) (#28)
    by Dadler on Thu Mar 13, 2014 at 11:30:13 AM EST
    What is your point? It seems quite, um, LOGICAL, that trying to estimate these numbers is a dice roll. You do realize, I would hope, that a certain number of people they factored are going to stick with their dealers simply because they don't want the government to know they toke. This will always be the problem you face with legalization. And it is not the fault of users, it is ENTIRELY the fault of an irrational government runk amok with corrupt cash in their pockets.

    Parent
    I thought my points were obvious. (none / 0) (#29)
    by leftwig on Thu Mar 13, 2014 at 01:59:09 PM EST
    Sales and tax revenues aren't close to estimates so far.  ITs a small sample, but given that sales were much higher at the beginning of the month than the end of the month and that more than half of the sales were to out of staters, the prognosis for future growth isn't great.  The governor proposed spending on two new programs that he thought were necessary given legalization, youth prevention and addiction treatment.  IF sales don't pick up from January and these new programs are implemented, the net affect will be a wash on the state making any money off pot sales.  

    I've got no issues with legalization (of all drugs) assuming employers may drug test and base hiring/firing practices on use as they see fit and that public assistance be denied to users.  I was always skeptical that the reason to support legalization should be based on a financial windfall.  

    Parent

    That's not what she said (none / 0) (#16)
    by Yman on Wed Mar 12, 2014 at 06:10:46 PM EST
    More importantly, from the article:

    The state says 59 businesses filed a return for the Department of Revenue's report. The state's initial projections were based on assumptions about 40 businesses, however only 24 were actually approved to operate on Jan. 1.


    Parent
    Bloomberg link (none / 0) (#4)
    by ragebot on Tue Mar 11, 2014 at 10:13:54 AM EST
    has additional information.  Not sure just what the business model is but the blurb about half the sales coming from out of state buyers seems a bad sign.

    If pot laws are relaxed in other states (something that seems likely to me) the number of out of state buyers would decline.  

    Bloomberg link

    My fear is that (none / 0) (#9)
    by Mikado Cat on Wed Mar 12, 2014 at 09:09:57 AM EST
    there are going to be issues with minors. I grew up in house where the rule was if you are going to smoke pot, do it at home, and grow your own, don't mess with drug dealers.

    With legalization and parents that smoke, I don't see those parents being very strict about keeping the pot from their kids. More like families that drink wine, allow their kids to have some from time to time.

    I get the feeling somebody against pot is waiting out there to make trouble for such a family.

    Interesting site, price of weed

    Fear not... (none / 0) (#13)
    by kdog on Wed Mar 12, 2014 at 03:11:26 PM EST
    legal or not, every parent I know who enjoys recreational marijuana is very strict about keeping the kids in the dark, at least until they are old enough to understand.  At that point, a family that parties together stays together;)

    What I find ironic is nobody bats an eye when adults drink and even get hammered in front of their kids...that's fairly normal.  But being seen smoking a joint by a minor is some kind of grave sin, or a sign of a bad parent.  Whats up with that?  

    Even I'm conditioned this way...if I'm out and about partaking and see I kid I immediately feel guilty and move to a new spot or extinguish, yet I think nothing of drinking a beer or 6 in front of minors.  Sh*t when I was a kid, I'd bet I never saw my parent's friends sober;)

    What a difference a drug's popularity and social acceptance makes in how we are conditioned to behave/feel.

    Parent

    Maybe one thing is (none / 0) (#14)
    by jbindc on Wed Mar 12, 2014 at 04:14:43 PM EST
    What I find ironic is nobody bats an eye when adults drink and even get hammered in front of their kids...that's fairly normal.  But being seen smoking a joint by a minor is some kind of grave sin, or a sign of a bad parent.  Whats up with that?  

    Consuming alcohol, even in front of your kids, is legal.

    Most people, however, don't think it's a good idea to commit a federal offense in front of kids.

    Parent

    Most People (5.00 / 1) (#15)
    by squeaky on Wed Mar 12, 2014 at 05:35:27 PM EST
    Most people, however, don't think it's a good idea to commit a federal offense in front of kids.

    Your analogy, albeit literally correct, is very weak tea.

    Most people do not think of smoking weed in the grand way you are portraying it.

    Parent

    I disagree (none / 0) (#17)
    by jbindc on Wed Mar 12, 2014 at 06:20:55 PM EST
    Especially when you are talking about doing it in front of their kids.

    People know pot is illegal - it's part of the reason many people do it in the first place.  But most parents, I would have to believe, don't want their kids to know a) they are stoners and b)that they think it's ok to break the law.

    But of course you are going to argue with me...

    Parent

    Obviously (5.00 / 1) (#18)
    by squeaky on Wed Mar 12, 2014 at 06:48:20 PM EST
    We know very different people.

    Parent
    Mmm... (none / 0) (#20)
    by jbindc on Thu Mar 13, 2014 at 06:47:59 AM EST
    I posed this very question last night to some people I know that smoke pot. I did not give my response - all I asked is "Would you smoke pot in front of your kids?"

    They all answered "No."

    When I asked why not, when they would drink in front of their kids, they all sais, "Becaus smoking pot is illegal and we don't want our kids to see us doing it."

    (And for the record - I live in area that is older hippie central).

    Parent

    Federal offense? (none / 0) (#22)
    by kdog on Thu Mar 13, 2014 at 10:44:26 AM EST
    Sister please...we don't even know how many federal crimes there are.  I don't think it's a legality thing...more so a social-stigma remnants of "reefer madness" imo.

    Parent
    I think (none / 0) (#23)
    by jbindc on Thu Mar 13, 2014 at 10:48:09 AM EST
    Everyone knows possessing, smoking, buying pot is a federal crime.

    Why would it be a social stigma (at least mostly) if it's not illegal?  

    Parent

    I'm thinking the stigma... (5.00 / 1) (#24)
    by kdog on Thu Mar 13, 2014 at 11:04:25 AM EST
    is conditioned in us socially...but not because it is illegal.  There's no social stigma to driving 65 in a 55 for example, that's illegal.  

    Parent
    Driving 65 (none / 0) (#25)
    by jbindc on Thu Mar 13, 2014 at 11:12:31 AM EST
    will get you a ticket.

    Not thrown in federal prison.

    It's kind of a different thing.

    Parent

    In some jurisdictions... (none / 0) (#27)
    by kdog on Thu Mar 13, 2014 at 11:19:57 AM EST
    smoking a joint is just a ticket too. Or in the best of jurisdictions, now legal! ;)

    Agree to disagree...I don't think the stigma comes from the illegality, maybe partially but not all. Something else at work.

    Parent

    Criminal Nation (none / 0) (#26)
    by squeaky on Thu Mar 13, 2014 at 11:17:50 AM EST
    Well we are a Criminal Nation 95 million Americans have smoked weed.

    Obviously we need more Feds and more Federal Penitentiaries so these Federal law breakers can be put out of circulation..  Think of all the children we can save.

    Oh, and you may want to tell your Black friends that being black in front of children may be more dangerous than smoking weed in front of them, because if you are black your chances of getting arrested are 11x greater than if you are white..  which is crazy when you figure in that Blacks are 12% of the population.  Must be a Federal Law that justifies this statistic somewhere in the fine print of Federal Penal Codes..  


    Parent

    There's hardly any stigma to it anymore (none / 0) (#33)
    by shoephone on Thu Mar 13, 2014 at 09:54:46 PM EST
    As for it being a federal offense, about six years ago the Seattle Police Department made marijuana "crimes" its lowest priority. And at last August's Seattle Hempfest (eight months after WA voters approved I-502, making personal pot use legal) SPD cops handed out bags of Doritos to the festival goers.

    The tide is turning.

    Parent

    Envision these two scenarios: (none / 0) (#19)
    by oculus on Wed Mar 12, 2014 at 08:16:46 PM EST
    (1). Underage kids throw a party at the home of one of the kids. Drain the liquor bottles. Top up w/water.

    (2). Same kids smoke all the available mj.  Now what?  

    Parent

    Oregano? lol (5.00 / 1) (#21)
    by kdog on Thu Mar 13, 2014 at 10:34:29 AM EST
    Option 1 is the reason to this day I can't stand gin.  The gin bottle in Pops cabinet always had the most booze in it, and it's clear...got so f&ckin' sick I still can't so much as smell it without getting nausea.

    The old man was only an occasional pot smoker...it's actually a funny story about the only time I found some of his grass.  I was 17 and took a liking to this sweet retro-70's tan leather jacket of my dad's that he never wore anymore, so I borrowed it to wear to a Smashing Pumpkins concert. At the show I find an old roach in the pocket, musta been older than me.  Me, my best friend, and some random concert-goer smoked it in the men's room.

    New meaning to "passing the torch";)    

    Parent

    Great family history. (none / 0) (#30)
    by oculus on Thu Mar 13, 2014 at 02:45:15 PM EST
    Made me speculate. Absent the sacrament, would your musical tastes be closer to mine or vice versa?

    Parent
    No effect... (none / 0) (#31)
    by kdog on Thu Mar 13, 2014 at 03:28:49 PM EST
    I was into the devil music before I discovered the joys of the sacrament...though the sacrament did help to me really hear it, and in a whole new way.  

    Parent
    Not the direction (none / 0) (#34)
    by Mikado Cat on Fri Mar 14, 2014 at 03:02:40 AM EST
    I was thinking of. Your kids are "old enough to understand" and want to get high, maybe to celebrate straight A's at the end of a semester with a week long break before school starts. You make special brownies and your kid and a few friends have a good time on your patio some Friday evening.

    Somebody reports it to the police. Maybe you talked to all the parents on the phone, but turns out one of the kids parents is in a messy divorce and the other parent wants to make an issue out of it.

    The Fed position is no use by minors, how much of a mess might it be?

    That's pretty much the totality of my concern, what happens when a family choice of letting kids use Pot becomes a federal issue.

    Parent

    No more or less... (none / 0) (#36)
    by kdog on Fri Mar 14, 2014 at 10:43:28 AM EST
    of a mess than letting minors drink, I would imagine.  With drinking the feds wouldn't get involved, local law enforcement might if another parent complained or something bad happened.  I see the same would apply for reefer, to small an incident for the feds, let the locals handle it.

    Parent
    Use by minors (none / 0) (#39)
    by Mikado Cat on Sat Mar 15, 2014 at 08:32:17 PM EST
    was one of the fed conditions for keeping noses out. I hope you are right, but it seems like a window of opportunity for somebody to make trouble.

    Parents can get really cranky about what their kids do that they don't want them to do.

    Parent

    free treatment? (none / 0) (#32)
    by gilligan on Thu Mar 13, 2014 at 08:03:27 PM EST
    There is bound to be some increase in use and addiction with cheap, legal pot. How much of the money collected in taxes is going for "free, on-demand treatment" for the few people who become dependent or for the few people with genetic vulnerabilities to psychosis who decompensate when they smoke the easily available pot?

    So far (none / 0) (#35)
    by Mikado Cat on Fri Mar 14, 2014 at 03:04:35 AM EST
    Its not remotely cheap legally, only illegally.

    Parent
    site violator (none / 0) (#38)
    by fishcamp on Sat Mar 15, 2014 at 08:31:59 AM EST


    Colo. Earns $3.5 Million in Marijuana Taxes | 38 comments (38 topical)

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