Legal marijuana has now earned over $1 billion in tax revenue for the state, according to the Colorado Department of Revenue.
Marijuana dispensary sales taxes, business licensing fees and excise taxes brought in just over $1.01 billion from January 2014 to May 2019, DOR numbers show, with dispensaries selling around $6.7 billion worth of marijuana products during that span.
Colorado's marijuana industry has grown in sales volume every year since retail legalization in 2014, with 2019 on pace to be its highest-earning yet. According to the DOR, the state currently has 2,917 licensed marijuana businesses and 41,076 individuals who are licensed to work in the industry. In a statement announcing the new tax milestone, Governor Jared Polis wanted to make sure that growth continued as more states legalize marijuana for medical and recreational purposes.
“Today’s report continues to show that Colorado’s cannabis industry is thriving, but we can’t rest on our laurels. We can and we must do better in the face of increased national competition. We want Colorado to be the best state for investment, innovation and development for this growing economic sector,” Polis said. “This industry is helping grow our economy by creating jobs and generating valuable revenue that is going toward preventing youth consumption, protecting public health and safety and investing in public school construction.”
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Polis signed a bill allowing publicly traded companies and expanded private investment opportunities in Colorado's marijuana industry earlier this month, as well as bills legalizing marijuana delivery and social consumption at licensed businesses. All of the moves were done in the interest of maintaining Colorado's place atop marijuana entrepreneurship, he said when signing the documents in his office.
Medical and retail marijuana sales are both taxed a standard 2.9 percent in Colorado, and retail sales are hit with an additional 15 percent state tax. This doesn't count local taxes on retail sales, which can add an additional 5 to 12 percent.
A key selling point for legalization proponents is that marijuana tax revenue has infused over $194.2 million into Colorado's capital construction assistance fund for public schools since 2014, according to state tax documents, with an additional $69.2 million going toward the general public school fund. Marijuana tax revenue is also used to fund affordable housing, the regulation of legal pot businesses, youth prevention efforts, behavioral health treatment, law enforcement and youth education and recreation programs.
“Generating tax revenue is not the only reason or even the best reason to regulate cannabis,” said Mason Tvert, who co-directed Colorado's legalization campaign in 2012 and now serves as vice president of communications at marijuana public affairs firm VS Strategies. “But when those revenues start adding up to more than $1 billion, as they have in Colorado, it’s a pretty attractive bonus."