[Vision2020] Marijuana tax potential attracts new allies

[Gary Crabtree]

By the time you figure in all the costs such as the above mentioned
25+25+25% tax scheme, store rent, employee expense, security, advertising,
shrinkage, etc. you have got to wonder whether they can be competitive with
the guy who knows a guy in  B.C. I have serious doubts that this is going
to be the tax windfall that you and Washington state libs envision.

g


On Thu, Nov 7, 2013 at 8:19 AM, Tom Hansen <thansen at moscow.com> wrote:

> As Idaho prepares for budget cuts . . .
>
> Courtesy of today's (November 7, 2013) Spokesman-Review.
>
> ---------------------------------
>
> Marijuana tax potential attracts new allies
>
> DENVER – Colorado’s hearty embrace of a 25 percent marijuana tax this week
> could prove a turning point for legalization backers. They have long argued
> that weed should come out of the black market and contribute to tax coffers
> instead of prison populations.
>
> But it’s far too soon to say how much revenue the marijuana taxes in
> Colorado and Washington will actually produce when retail sales begin
> next year.
>
> A tax windfall in the two states could win over skeptical states that may
> be interested in pot legalization but wonder about costs of regulation. On
> the other hand, if many pot smokers in Colorado and Washington stay in the
> black market to avoid taxes, supporters could lose a major plank of their
> longstanding argument that legalization will take money from criminal
> cartels and benefit government programs.
>
> “It’s a crucial question,” said Sam Kamin, a University of Denver law
> professor who served on a panel that helped write Colorado’s marijuana
> regulations. “There’s this premise that marijuana legalization can be a
> net-net win, spending less money putting people in prison and seeing a tax
> benefit from the sale of marijuana. Voters are going to expect to see both.”
>
> Colorado’s vote Tuesday showed it wants the benefits, even in a
> tax-adverse state that typically rejects proposed taxes. The pot tax
> question – on an excise and special sales tax that could add more than 25
> percent to the sales price of weed – passed by nearly 2-to-1.
>
> That margin was much broader than Colorado’s legalization vote itself in
> 2012. Many who opposed legalization then supported the taxes this time
> around. Last year’s legalization measure also called for tax revenues for
> the state.
>
> Washington state has already settled its pot taxation scheme, charging 25
> percent at three possible transfer points from production to retail sale,
> plus sales taxes.
>
> It’s impossible to say precisely how much revenue the pot taxes will
> produce. A projection prepared for Colorado voters predicted pot taxes
> would bring in almost $70 million a year. Of that, $27.5 million would go
> to school construction, as specified in last year’s ballot measure that
> legalized the drug.
>
> The rest of the money would go toward paying for the regulation of pot
> shops. Several Colorado municipalities approved additional pot taxes
> Tuesday, ranging from 3.5 percent in Pueblo County to up to 10 percent in
> the city of Boulder.
>
> Both Colorado and Washington are taxing pot based on the sales price,
> unlike alcohol and tobacco, which are taxed by the gallon or by the pack.
> The price of marijuana varies widely based on potency and quality and is
> likely to go down once recreational sales are legal.
>
> Based on crowdsourced estimates of what black-market pot smokers pay,
> Colorado’s state tax rate would add about $50 to a $200 ounce of loose
> marijuana, roughly the amount that would fit in a sandwich-sized plastic
> bag. Local taxes could bring the total consumer tax burden near 30 percent,
> or a total price of $260 an ounce.
>
> Denver approved a 3.5 percent tax Tuesday that could generate $4.5 million
> a year. The Denver Post has predicted state and city taxes will add $8.59
> to a $30 eighth of an ounce of pot.
> ---------------------------------
>
> [image: image.jpeg]
>
> Seeya 'round town, Moscow, because . . .
>
> "Moscow Cares" (the most fun you can have with your pants on)
> http://www.MoscowCares.com
>
> Tom Hansen
> Moscow, Idaho
>
> "There's room at the top they are telling you still
> But first you must learn how to smile as you kill
> If you want to be like the folks on the hill."
>
> - John Lennon
>
>
>
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