Colorado was among the first states to legalize cannabis for recreational purposes on January 1, 2014. As it turns out, revenue from cannabis tax is very lucrative indeed.
According to law firm Vicente Sederberg based in Denver, the state of Colorado has generated more than $1 billion in cannabis tax revenues since legalization in 2014. The report carried out by the company, entitled, Colorado Cannabis Revenue Surpasses $1 Billion Since Legalization – A brief analysis of the first 64 months of cannabis sales and revenue under Amendment 64, has some interesting statistics.
These numbers are drawing attention with a hint of jealousy from states across the US and countries all over the world… and it’s clear to see why.
The Vicente Sederberg report states:
On November 6, 2012, Colorado voters approved Amendment 64, a citizen-initiated ballot measure intended to legalize, regulate, and tax cannabis for adult use. Cannabis officially became legal for adults 21 and older on December 10, 2012, and regulated adult cannabis sales commenced January 1, 2014. Since then, more than $6.56 billion in regulated cannabis sales have taken place in the state, including more than $4.46 billion in adult-use sales and nearly $2.1 billion in medical sales.
While funds collected by the Department of Revenue topped a total of $1.02 billion by April 2019, the report mentions that the amount, “does not include hundreds of millions of dollars in additional cannabis related taxes and fees collected by local governments.”
A lot of cannabis tax revenue is going towards education
Interestingly, the powers that be in Colorado are plowing a large chunk of the tax revenue – not into traffic circles and parking lots – but into education. At least $280 million is already earmarked for K-12 education. A large amount will also be spent on building new schools across the Centennial State.
But it doesn’t stop there as millions of dollars have also been put towards cannabis research, addiction treatment, affordable housing, and numerous other public programs. It appears to many that perhaps cannabis wasn’t really that bad after all – at least as far as money is concerned.
The new cash injection is also paving the way for Colorado to designate funds towards further regulating the cannabis industry; something many people want to happen. However, co-author of Amendment 64 which made cannabis legal in Colorado, Brian Vincente, threw some water on the fire in recent statements he made, according to a High Times report.
“We were never under the illusion that legalization would be a fiscal panacea, but we knew it would have a substantial and positive impact,” he said. “Funds are being used on everything from building schools to hiring school health professionals and paying for bullying prevention programs.”
With all that said, Mason Tvert, co-author of the bill, noted that other states could and should use Colorado as a role model when it comes to cannabis legalization. “Generating tax revenue is not the only reason or even the best reason to regulate cannabis,” he said. “But when those revenues start adding up to more than $1 billion, as they have in Colorado, it’s a pretty attractive bonus. It’s crazy to think how much money states are flushing down the toilet by keeping marijuana in an illegal market.”
So many other states in the US have a booming market when it comes to cannabis. The problem is, in states where cannabis isn’t legal, that market is the black market. That means that billions of dollars never make it to the tax man and end up just lining the pockets of street dealers. That situation cannot be allowed to continue any longer, especially as people have no idea what they’re buying.
Commentators and reporters will be keeping a close eye on the developments in Colorado – a state at the forefront of cannabis legalization – to see what valuable lessons can be learned and implemented elsewhere.
