Colorado Marijuana Sales Tax, Proposition AA, Is Excessive

COLORADO: Colorado NORML is an advocate for Coloradans who responsibly consume marijuana. These consumers will bear the burden of any taxes enacted by voters on the retail sale of marijuana. We do not object to taxation of marijuana generally, but rather to taxation that is excessive or unnecessary.

Our opposition to Proposition AA stems from our belief that the existing sales tax structure and licensing fees should be sufficient to ensure a robust regulatory enforcement agency for marijuana.

The 2013 Blue Book is projecting marijuana sales in 2014 to be $394.6 million. At this level, which we believe is conservative, the normal 2.9 percent state sales tax and 3.5 percent local sales taxes are projected to raise over $25 million in revenue to fund state and local regulatory enforcement. This projection does not include the numerous application and licensing fees paid by retailers to state and local regulators.

The Medical Marijuana Enforcement Division’s budget was $5.2 million in 2012. The state has already generated over $6 million in state tax revenue from medical marijuana sales through the third quarter in 2013. If necessary, the Colorado legislature could double the state regulator’s annual budget and still not require any additional “special” sales tax measure.

We think that means marijuana consumers in Colorado will be paying excessive taxes under Proposition AA.

It is our position that excessive taxation, along with the decision of many local jurisdictions to “opt out” of Amendment 64’s business licensing provisions, has the potential effect to keep a black market for marijuana alive in Colorado. The decision of local communities to ban retail recreational marijuana sales is the most substantial factor in supporting an unregulated market for marijuana.

Colorado NORML has a long history of supporting responsible use of marijuana, including limitations on public use and driving impaired. We have no affiliation to the group that protested Proposition AA with a free joint give-away in Civic Center.

Read full article @ Denver Post