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Marijuana tax take nearly double expected in Colorado

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Re: Marijuana tax take nearly double expected in Colorado

#41

Post by kej »

omni wrote: post #21
Zelphyr wrote: post #17

Earlier quoted context omitted.

Yes, CO has a tax free day on cannabis only. My understanding is they reaped too much in taxes and their laws are such that they have to give the overage back. The tax-free day is a way to do that.

That's some bizarre logic. Tax-free day doesn't "give back" anything, it just slows down the rate at which they exceed what they thought was acceptable.

You're both right. There's a tax-free day to slow down the amount of tax brought in, but state law does require returning unexpected tax windfalls that exceed inflation and population growth. Wikipedia has a good overview: https://en.wikipedia.org/wiki/Taxpayer_Bill_of_Rights

Re: Marijuana tax take nearly double expected in Colorado

#42

Post by aggie »

AaronFriel wrote: post #34

This is good news and bad news. The funding for schools will be a boon to education in the state, and that's certainly not bad. However, I expect will almost certainly lead to decreased education funding from other revenue sources, and ultimately place education footing on less solid ground for years to come. It was brilliant PR move to earmark the tax revenue for education, there's no doubt about that. It's very har…

Are sin taxes really that volatile? I don't have good data, but many people suggest marijuana (as well as alcohol) is counter-cyclical and demand is relatively inelastic.

http://www.marketwatch.com/story/amid-the-stock-market-volat...

edit: This study suggests alcohol is actually pro-cyclical (in Scandanavia). [pdf] http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.185...

Re: Marijuana tax take nearly double expected in Colorado

#43

Post by peter303 »

xienze wrote: post #26

The bad news is that this amount of revenue will become the new normal, i.e., future budgets will always assume this amount of revenue or more. I think the novelty factor wearing off and other states legalizing marijuana will put a dent in this number in the future. So hopefully the government won't go too nuts assuming hockey stick growth.

Tax revenue is capped in Colorado. Their version of proposition-13, called TABOR, limits revenue increases to population increase plus inflation. Colorado is having a one-day marijuana tax holiday Sept 16. They are arguing about how to refund the rest of the over-taxation required next year. Its been done several times before, either with small rebates or tiny decreases in the income tax rate.

Re: Marijuana tax take nearly double expected in Colorado

#44

Post by AaronFriel »

aggie wrote: post #42
AaronFriel wrote: post #34

This is good news and bad news. The funding for schools will be a boon to education in the state, and that's certainly not bad. However, I expect will almost certainly lead to decreased education funding from other revenue sources, and ultimately place education footing on less solid ground for years to come. It was brilliant PR move to earmark the tax revenue for education, there's no doubt about that. It's very har…

Are sin taxes really that volatile? I don't have good data, but many people suggest marijuana (as well as alcohol) is counter-cyclical and demand is relatively inelastic. http://www.marketwatch.com/story/amid-the-stock-market-volat... edit: This study suggests alcohol is actually pro-cyclical (in Scandanavia). [pdf] http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.185...

Even a small (4-6%) change in revenue can wipe out inflationary increases in funding for education. Even if they're counter-cyclical, the evidence is that replacing education funding with something more volatile is risky, because it's replacing consistent funding with something that is based on market dynamics.

In the case of marijunaa, it's largely cultural.

Re: Marijuana tax take nearly double expected in Colorado

#45

Post by moonchrome »

chipgap98 wrote: post #31
Phlarp wrote: post #23

Earlier quoted context omitted.

Alcohol is heavily taxed, and as any liquor store owner will tell you, it's taxed at every possible opportunity: production, distribution and end user sales. We should be striving to bring overall tax rates for tobacco and marijuana up to match alcohol.

Marijuana has an incredibly high tax in Colorado. IRC its like 25%

25% incredibly high ? Some European countries have higher VAT than that :(

Re: Marijuana tax take nearly double expected in Colorado

#46

Post by peter303 »

AaronFriel wrote: post #34

This is good news and bad news. The funding for schools will be a boon to education in the state, and that's certainly not bad. However, I expect will almost certainly lead to decreased education funding from other revenue sources, and ultimately place education footing on less solid ground for years to come. It was brilliant PR move to earmark the tax revenue for education, there's no doubt about that. It's very har…

The silliest tax earmark was for anti-pot education, especially aimed at under 18. Seeing users and magazine ads everywhere saying it is good for adults, but how could you say its bad for teens then?

Re: Marijuana tax take nearly double expected in Colorado

#47

Post by pfooti »

ohitsdom wrote: post #16
JustSomeNobody wrote: post #8

Chicago and Detroit should take note. Allow drugs and tax the hell out that sh .

If you tax it too much, I'd imagine that'd increase viability for a black market.

I'd contend that black markets for tax evasion are qualitatively different from black markets for restricted goods. Consider the hefty tax on cigarettes. Sure, there's a cigarette black market, but it's not nearly the majority of the market.

The (highly-opinionated) Tax Foundation did a study on this [0]. I'm not sure how reliable their numbers are (again: they're a foundation with an agenda), but if you read through their own spin, you can see that the big tax-based black market for cigarettes exists where there's a state-border disparity in tax rates, and even then, in 48 states the (estimated) black market took up less than half of the actual market.

So: set taxes at whatever arbitrary level, but don't go too high. Also, consider setting national tax rates instead. So many of our problems derive from state-level control of stuff. Delaware corporations, state taxes, state laws. But I'm just a poor socialist / federalist.

[0]: http://taxfoundation.org/article/cigarette-taxes-and-cigaret...

Re: Marijuana tax take nearly double expected in Colorado

#48

Post by peter303 »

atom-morgan wrote: post #30
pavel_lishin wrote: post #25

Earlier quoted context omitted.

But a black market already exists.

And taxing it enough ensures those black markets don't disappear.

Regulations is a secondary taxation on legal dealers. Businesses have to pay high license fees, buy required security, keep records of EVERY PLANT (rfid tags). Its still profitable enough and safe enough from police harassment that there about 900 businesses.

Re: Marijuana tax take nearly double expected in Colorado

#49

Post by dupe576 »

leesalminen wrote: post #29
lotharbot wrote: post #5

Earlier quoted context omitted.

Colorado collected $42 million in alcohol taxes over the same time period. http://dailycaller.com/2015/09/15/colorado-just-became-the-f...

This doesn't take into account the revenue the state gains through its vicious DUI/DWAI laws. I would venture to guess that number far exceeds $42 mm/annum.

If you are going to include that, wouldn't you then have to include all the money it costs the state to pay for damages caused by drunken drivers?

Re: Marijuana tax take nearly double expected in Colorado

#50

Post by jessaustin »

Phlarp wrote: post #23
mulletbum wrote: post #13

Earlier quoted context omitted.

Shouldn't there be an aspect of "what is right?" Just because taxes are more or less, revenues increase or decrease, we were putting a huge financial burden and physical burden on a drug that is no worse than alcohol. I think that is the top consideration, what is right, not which way is more financially helpful. (Not trying to be argumentative here, sorry if it sounds that way. It feels like this point is heavily mi…

Alcohol is heavily taxed, and as any liquor store owner will tell you, it's taxed at every possible opportunity: production, distribution and end user sales. We should be striving to bring overall tax rates for tobacco and marijuana up to match alcohol.

'sparkystacey you appear to be hellbanned. It's not obvious why since your comments seem innocuous.
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