After only a month in business, the “Great Colorado Cannabis Experiment” is proving to be a profitable venture for the state. Recent sales records reveal that retail weed slingers were responsible for collecting some $1.24 million in tax revenue in January -- putting the state’s recreational marijuana industry on the fast track to earning over $100 million a year in taxes.
During a recent survey conducted by NBC News, half of Colorado’s licensed recreational marijuana retailers opened up their books and shared tax records for their first 27 days in business. Not only do these documents indicate that pot shops are generating higher revenue levels than expected, but it also points toward a time in the not so distant future when marijuana may generate more tax dollars than alcohol, or even cigarettes.
In 2013, Colorado managed to collect about $40 million in taxes derived from alcohol sales, as well as nearly $32 million from tobacco products. Cigarettes, however, were one of the state’s highest sources of tax income -- producing about $166 million. Yet, marijuana is poised to become the number one contender.
This is promising news for many state funded projects, especially Colorado schools. State law mandates that the first $40 million collected in recreational marijuana tax be applied towards bettering the state’s educational facilities. Additional revenue will be used to improve the conditions of the state’s roads, bridges and parks, according to recent reports.
“Elected officials around the country are watching what’s happening in Colorado and they're recognizing that there's a better way to handle marijuana,” said Mason Tvert, director of communications for Marijuana Policy Project, during an interview with Today. “And by regulating its sale and having taxes paid on it, it’s a much more sensible approach.”
Lawmakers in Rhode Island, where the state is faced a $100 million deficit, say they want in on the action. Senator Joshua Miller says he has introduced legislation aimed at legalizing marijuana in the state because it will produce $20 million per year in tax revenue, which will chip away at the state’s financial adversity by about 20-percent every year.
Last year, many that opposed Colorado’s three-way marijuana tax argued that it would continue to stimulate the black market. However, Colorado weed retailers say the near 29-percent tax imposed on pot transaction does not appear to be deterring customers. Toni Fox from 3D Cannabis says her store generates an average of $20,000 per day. “We could double that if we had enough inventory, but currently there’s an inventory shortage so we’re capping our sales,” she said.
Industry insiders believe Colorado’s newfound recreational marijuana trade will become even more impressive as the year progresses.
Mike Adams writes for stoners and smut enthusiasts in High Times, Playboy’s The Smoking Jacket and Hustler Magazine. You can follow him on Twitter @adamssoup and on Facebook/mikeadams73.