State Tax Revenues Benefit From Legalized Cannabis Market

NEW YORK:  The legal cannabis market is expected to generate more tax revenue for states in the U.S, according to a report from New Frontier Data.

The U.S. cannabis market could generate $2.3 billion in state tax revenue from retail sales by 2020. The projection is based on the assumption for projected growth in all states currently legal for medical and recreational use of cannabis. According to the Colorado Department of Revenue tax data, dispensaries in Colorado, the first state in the United States to legalize cannabis, sold a record of $1.3 billion of legal cannabis in 2016.

New Frontier Data CEO Giadha Aguirre De Carcer. Said: “During this tough economy states are looking for any way to close their budget shortfalls and it appears that cannabis may hold an answer for them. New Frontier Data looked at the potential revenues that could be generated from state cannabis taxes and found that in this year alone, states could raise nearly $750 million and triple that number by 2020. These revenues will have a meaningful impact on state programs and provide governors with much needed breathing room in their budgets,”

 

Recreational Marijuana Tax Begins In Oregon

OREGON: Starting this week, recreational marijuana sales in Oregon will be taxed at 25 percent.   Ever since medical marijuana dispensaries began selling recreational pot on October 1, the sales have been tax-free.

The 25 percent tax applies to all recreational sales through the end of 2016.

Later this year, the Oregon Liquor Control Commission will start licensing retail stores. Stores that become licensed will have a reduction in their pot sales taxes — to 17 percent.

Local governments can also adopt an additional local tax up to three percent.  Since October, sales have been limited to what cannabis produces, such as leaves, flowers, and seeds.

Weighing Enforcement And Black Market, City Introduces Marijuana Tax

ALASKA: The Anchorage Assembly is introducing a measure to tax marijuana when sales become legal in the year ahead. The proposal hinges, however, on voter approval in April.

Though it’s still several steps away, Assembly members are proposing to eventually tax marijuana retail sales at five percent.

Ernie Hall chairs the committee that’s been looking at how to tax cannabis products within the municipality, and said the figure is a preliminary estimate of what the city will need to collect in order to pay for the licensing and enforcement costs that come along with opening new businesses.

“This is drafted where if we start at five and we find out we’re not covering the expense of this industry we can adjust it two percent at a time over a number of years,” Hall explained after the committee meeting adjourned Thursday evening. The Assembly would only be able to change the percentage taxed every two years.

America’s Marijuana Traders In Anti-Tax Revolt

DISTRICT OF COLUMBIA:  In the US, marijuana businesses are on a war footing. Although 23 states have legalised cannabis for medical or recreational use, sellers continue to be seen and treated as second-rate entrepreneurs.

The cultural prejudice of public opinion is partly to blame but it’s mainly because of the current system of federal taxation, which is based on the old prohibitionist principles that penalise the selling of a substance that was illegal until very recently. Unlike other businesses, those dispensing marijuana can’t deduct their business overheads from their income tax, including rent of the premises or staff salaries. In short, there are two very different sets of rules. As Bruce Nassau, a marijuana trader in Colorado, told the New York Times, this could suffocate a sector that has enormous growth potential.

Their reasons for protesting are: “We are proud to make our contribution to the state treasury but we want to pay a fair amount.”

Marijuana Tax Up In Smoke? Don’t Worry, Feds Plot 50% Tax

DISTRICT OF COLUMBIA: Marijuana activists look to Colorado as a true leader, with legalized recreational use and tiered tax models. Coloradans and activists nationwide thought legalizing marijuana would mean huge tax revenues. Nationwide, there is a near intoxication promising money, jobs, appreciating real estate, and tax revenues that could achieve so much for so many.

Naysayers worry about public health risks, especially for young people. Yet even some naysayers find copious tax revenues alluring. In Colorado, the governor’s office estimated it would collect $100 million in taxes from the first year of recreational marijuana. The state’s economists were more conservative, estimating $67 million. They recently revised it downward to call for taxes of $58.7 million from recreational marijuana.

Now, Colorado’s first year tax haul for 2014 recreational marijuana is a disappointing $44 million, causing some to say that Colorado’s marijuana money is going up in smoke. Yet perhaps that is premature. Colorado was first to regulate marijuana production and sale, so other governments are watching closely. Although disappointing, the $44 million is nothing to sneeze at. Colorado also collected sales tax on medical marijuana and various fees, for a total of about $76 million.

Colorado Lawmakers Plan To Boost Marijuana Profits

COLORADO: The federal government has reluctantly agreed to let Colorado be the first state to collect taxes from the legal sale of recreational marijuana, but it also has made clear it doesn’t agree with the move and may try to stop it, if isn’t tightly controlled.

Instead of keeping a low profile with the money, however, some Colorado lawmakers are trying the bold move of using millions of dollars they’ve collected so far from pot sales to seek matching funds from the federal government to keep kids off drugs.

The plan calls for transferring $3.5 million from the state’s marijuana cash fund to its general fund and then sending the same amount to a state department that would apply for a federal match.

Democratic state Sen. Pat Steadman, the measure’s sponsor, joked that the bookkeeping move “is what I’m calling money laundering.”

Colorado Pot Taxes Won’t Be As High As Hoped

COLORADO:It’s been just three months since marijuana was legalized in Colorado, but economists don’t think the state will raise as much in taxes as was hoped.

They had expected to raise $22.7 million before July from special sales taxes on recreational marijuana, but state economist Larson Silbaugh is skeptical.

About $3.4 million was raised in January and February, the only months for which sales have been reported so far.

“If current tax revenues keep coming in at the same pace, we won’t meet that expectation,” Silbaugh said.

Colorado Legalized Marijuana Tax Revs Ahead Of Expectations: Moody’s

COLORADO: Colorado, the first state to tax legalized recreational marijuana sales, expects to bring in an estimated $98 million in revenue this year, exceeding the state’s original expectations by 40 percent.

The state began levying sales and excise taxes on recreational marijuana on January 1, 2014. Moody’s Investors Service, in a report released Friday, said legal sales in Colorado will reduce the size of the black market and revenue from legal sales will mean more tax payments flowing into state coffers.

The funds are slated for treatment, school construction and deterring young people from using the drug. School districts will likely get $40 million, or nearly 30 percent, of the projected $134 million in total marijuana tax revenues. New revenues will only make up 1.4 percent of the state’s available general fund.

Is It Time For The U.S. To Legalize Marijuana?

COLORADO: Is it high time for the federal government to legalize marijuana?

That’s what pot activists are asking a day after Colorado voters approved a historic ballot measure to tax legal marijuana sales, and Portland, Me., became the first East Coast city to vote to legalize marijuana for adults. [Read more…]

Is It Time For The U.S. To Legalize Marijuana?

COLORADO: Is it high time for the federal government to legalize marijuana?

That’s what pot activists are asking a day after Colorado voters approved a historic ballot measure to tax legal marijuana sales, and Portland, Me., became the first East Coast city to vote to legalize marijuana for adults. [Read more…]