COLORADO: Before Colorado became the first state to allow marijuana for recreational purposes, supporters boasted that legalization would generate a sizable tax windfall, while opponents warned that it could have dramatic social consequences.
Slightly more than a year into the state’s experiment with sanctioning pot sales to adults 21 and older, neither prediction is proving entirely true. Marijuana so far hasn’t been the boon or bane that many expected, offering potential lessons to other states considering legalization.
The office of Colorado Gov. John Hickenlooper last February estimated the state would haul in nearly $100 million in revenue from recreational marijuana taxes in the fiscal year that began in July. But sales have been slower than expected—due in part to a 25% tax rate that experts say has steered potential users toward medical marijuana, which is cheaper.
State economists revised their own, separate forecast on Dec. 22, estimating that recreational pot sales would generate $58.7 million in tax revenue for the fiscal year, down from $67 million.