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Colorado is the first state in history to collect more taxes from cannabis than alcohol

meghan 2015-09-16 0 comments

Colorado voters legalized cannabis in 2012 and the new laws took effect in 2013. From there, it only took a couple fiscal years for tax revenue from the plant to supersede that of alcohol. And the margin was far from small, with the Colorado Department of Revenue reporting a whopping $70 million in pot taxes compared to $42 million in alcohol.

Recreational marijuana in Colorado is taxed sharply at two levels—a 15% excise tax from the grower to the retailer, and then 10% as it travels from the retailer to the consumer. Alcohol is taxed by volume, which ranges depending on the type of alcohol purchased. Both are subject to the 2.9% Colorado sales tax.

Colorado declared September 16th, 2015 a marijuana tax holiday, where the total of 25% of taxes will be suspended for the day. This is a mandatory move as per the Colorado Taxpayer’s Bill of Rights, which requires that newly enacted taxes be refunded or waived if the collected amount exceeds that of the projections that were provided to voters.

Pot shops have planned accordingly—enacting one-day sales and stocking shelves in preparation for what many assume will be increased customer traffic. The tax structure will return to normal on September 17th.