Since legalizing marijuana more than a year ago, Colorado and Washington have collectively raked in more than $200 million in tax revenue. Colorado has collected more than $117 million in excise taxes alone from both medical and recreational weed. Washington, on the other hand, took a while to take off, but it already made $83 million in excise taxes since July 2014.
And there are more taxes involved, like sales taxes, jurisdictional taxes, fees, and licensing costs, so it’s safe to say that the total tax revenue coming from marijuana sales is millions higher than the estimate.
But before you start protesting about how much the government makes off these regulated substances, you should know that they’re actually putting it to good use. For one, it helps pay the regulation supporting the legal marijuana market.
“Our philosophy has been that marijuana pays its own way,” said J. Skyler McKinley, deputy director of marijuana coordination for Colorado. “Every dime we bring in from legalization is dedicated to the cost of legalization. That’s regulatory framework first, then public education campaigns about safe and responsible use, and then prevention and treatment programs.”
After all, the goal of cannabis legalization is not really to generate more revenue, but to regulate the marketplace and prevent people from profiting in the black market. Whatever money is generated from legal weed is just a nice assistance to the state budget.
Schools and research
But aside from supporting marijuana regulation, another place where the legal weed taxes go is public schools and research.
According to Kevin Huber of Colorado’s Education Department, $23.9 million of the state’s marijuana tax revenue from 2014 to 2015 were given to the Building Excellent Schools Today (BEST) grant program. Other sources of funding for the BEST program are state lottery spillover proceeds and interest and state land trust. Similarly, these taxes also funded $8 million in marijuana research.
For Washington, a portion of taxes and fees also goes to schools, but most of it is allocated towards researching the effects of the state’s reformed marijuana policy. One of these researches is about a broad cost-based analysis of the legalization of recreational marijuana conducted by the Washington State Institute for Public Policy.
Legalizing marijuana was certainly a huge shift in drug policy that scared many lawmakers and law enforcers in the beginning. But nothing really changed much in both Colorado and Washington, except for the additional revenue that the government generates.
“This was a lot less vexing than we once thought it would be,” McKinley said. “It turns out government can be pretty good at this.”
Where else do you think marijuana taxes should go? Voice your opinions in the comments section below – your opinion matters to the nation.