Pubdate: Mon, 29 Sep 2014
Source: Washington Post (DC)
Copyright: 2014 The Washington Post Company
Contact: http://mapinc.org/url/mUgeOPdZ
Website: http://www.washingtonpost.com/
Details: http://www.mapinc.org/media/491
Author: Niraj Chokshi
Page: A14

WASH., COLO. ASSESS THEIR POTS OF GOLD

Two States Expect $811 Million From Taxes on Marijuana Sales

If a pair of new government forecasts prove true, Washington and 
Colorado would see more than $800 million in extra revenue over the 
next few years thanks to marijuana sales. At the least.

The estimates, both released in recent days, differ greatly in what 
they predict and over what time period. But together they show that 
the plant, now legal to purchase in both states, could generate at 
least $811.2 million for the trailblazing states before 2020. 
Washington can expect $637 million by 2019, while Colorado can expect 
$174.5 million through the fiscal year that ends in 2017, according 
to state estimates.

Such estimates are difficult to make because there is no precedent 
for what is being forecast: Marijuana for recreational use has never 
before been sold legally in the United States. Washington's forecast, 
released by the state's Economic and Revenue Forecast Council, was 
the state's first prediction to be based on actual sales, which began 
in July. In Colorado, sales began in January, so the state's 
Legislative Council had slightly more data to work with for its estimate.

The new Washington forecast through 2019 is a slight upward revision 
from February and June forecasts, thanks in part to sales beginning 
sooner than forecasters predicted, raising near-term estimates. Just 
less than 30 percent of the total expected revenue will go to the 
state's general fund, while the remaining portion has been flagged 
for specific uses. As a result, lawmakers will have an extra $186 
million to manage as they please.

Colorado's forecast was calculated differently. Unlike Washington's 
forecast, state economists in Colorado expect sales to remain roughly 
flat from year to year, steadily yielding just less than $50 million 
annually. The authors were careful to note that their estimate is 
based only on "a few months of data for a maturing market" and that 
conditions are still changing.

"The marijuana market is maturing which will impact the price and 
consumption of regulated marijuana," they wrote. "Specifically, more 
local jurisdictions have allowed adult-use marijuana stores and 
adult-use marijuana businesses are no longer required to be 
vertically integrated."

There were few changes made between the June and September reports, 
they wrote, because incoming taxes were "generally consistent" 
between the forecasts. As in Washington, some of the revenue in 
Colorado will be flagged for particular uses, such as education 
funding and addiction programs.
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MAP posted-by: Jay Bergstrom