Colorado marijuana sales hits $1 billion in first eight months of 2017
Author: Leslie Simms - November 28, 2017 - Updated: May 23, 2018
Colorado’s legal marijuana industry generated a record $1 billion in sales during the first eight months of 2017, producing more than $160 million in taxes and fees for critical Colorado services.
With more than $1.02 billion in collective medical and recreational sales through August, sales are up 21 percent from the same period last year, according to The Cannabist, the marijuana news portal of The Denver Post, which analyzed state tax data released last week.
This equates to more than $162 million in taxes and fees for the state, which has received more than half a billion dollars in tax revenue since the first marijuana retail store opened its doors three-and-a-half-years ago.
Half of the money generated from taxes and fees goes to K-12 construction projects, according to an analysis of state data through May 2017. Nearly $6 million was allocated for school drop-out prevention programs and bullying prevention and education. Another $4.5 million went towards grants to increase the presence of school health professionals. Substance abuse prevention and treatment received $16 million, and $10.4 million was used for mental and behavioral health services.
At the local level, one county used $420,000 in marijuana tax revenue this year to provide college scholarships to 210 students. The City of Aurora allocated $1.5 million in cannabis tax revenue to fight homelessness. It is also using marijuana tax money to improve local roads and help pay for a new recreation center. Another Colorado city has used cannabis tax revenue — which accounted for 20 percent of its budget in 2016 — to repave its streets, fix miles of sidewalks, and help fund the construction of a new city complex.
The monthly tax data now comes with some additional stipulations as marijuana sales have been subject to a different taxing structure for the past two months, reported The Cannabist.
The special sales tax rate for recreational marijuana increased from 10 percent to 15 percent in July. The new law also exempted recreational marijuana products from the 2.9 percent standard state sales tax, while medical marijuana and accessories are still subject to the 2.9 percent sales tax rate.
Colorado’s cannabis industry is the state’s fastest-growing business sector, creating thousands of jobs and providing an estimated economic impact of $2.4 billion. Because marijuana is grown, packaged and sold in Colorado, cannabis companies hire workers, pay rent and use services from a number of other Colorado sectors, including construction, legal, commercial real estate, insurance and engineering. All the money generated from those jobs and services stays in the state.