It's always been the easy argument for legal drugs: "Legalize, regulate, and tax. The Government will make a fortune!"
As is typically the case, what is intended, and what is reality are not the same:
Colorado's tax collections from recreational marijuana sales in the past fiscal year came in more than 60 percent below early predictions, and now a state lawmaker says it may be time to reconsider the tax formula.
State Rep. Dan Pabon, who is leading a special legislative committee on marijuana revenue, said the medical-marijuana system also may come under scrutiny.
"There's some real impact that the medical marijuana market is having on the recreational marijuana market," said Pabon, D-Denver. "I think it's worth looking at the taxation on the recreational side but also looking at the rules and regulations on the medical side."
When Colorado voters approved special taxes on recreational marijuana in November, the official fiscal analysis estimated the taxes would bring in a combined $33.5 million through that fiscal year, which ended this summer. Budgeters for Gov. John Hickenlooper had similarly optimistic projections.
But the actual number came in at just more than $12 million.
Rather than pulling consumers out of the medical-marijuana market, the recreational market largely has feasted on tourists and people who previously bought pot on the black market.
The problem lies with how it is taxed. "Medical" pot is taxed at a much lower rate than "Retail" dope. It's not too difficult to get a note from your doctor for weed, so smart smokers are going the medicinal route.
Big deal, WAMK. So tax revenues are down. What difference does it make? Well, when the Governor puts tax revenue numbers at $98 million this year from pot, there may be a healthy shortfall. Considering voters were told to expect around $70 million in tax revenue when it was put on the ballot, it may have been a better idea to underpromise, and overdeliver this year.
Hopefully, the tax revenues catch up to projections. If it's legal, we may as well get every penny we can from it.