Pubdate: Sun, 15 Feb 2015 Source: Washington Post (DC) Copyright: 2015 The Washington Post Company Contact: http://mapinc.org/url/mUgeOPdZ Website: http://www.washingtonpost.com/ Details: http://www.mapinc.org/media/491 Author: Christopher Ingraham COLORADO'S LEGAL WEED MARKET: $1 BILLION BY 2016 Legal marijuana was a $700 million industry in Colorado last year, according to a Washington Post analysis of recently released tax data from the state's Department of Revenue. In 2014, Colorado retailers sold $386 million of medical marijuana and $313 million for recreational purposes. The two segments of the market generated $63 million in tax revenue and $13 million in licenses and fees. The total economic impact of the state's marijuana industry is likely greater, as these figures don't include retail sales of related products, like pipes and bongs, and they don't account for increased tourist spending in other segments of Colorado's economy, like hotels and restaurants. With a full year of data, the state has a clearer picture of what to expect from its marijuana market. Total marijuana tax revenue is expected to climb to $94 million annually by 2016, according to the latest projections. This would equate to a $1 billion dollar retail market. The revenue figures are high enough that Colorado now finds itself in the enviable situation of having to figure out what to do with all that money. And it's catching the attention of other states, like Vermont, now considering legalization. But Colorado's pot businesses aren't necessarily rolling in dough. Marijuana growers and retailers aren't eligible for the wide variety of tax deductions available to other businesses, which could take a huge bite out of their profits. Banks are also hesitant to do business with the marijuana industry for fear of a federal crackdown, which makes legal weed a de-facto cash-only proposition, with all of the risks and dangers that entails. The federal government has been taking steps - albeit small ones - to help integrate the marijuana industry with the rest of the market. Late last year the IRS issued a memorandum assuring accountants who file taxes for marijuana businesses that they won't face increased risk of an audit or penalties. And tucked within December's last minute spending compromise in Congress was a measure forbidding the Drug Enforcement Agency from raiding medical marijuana outlets, provided those outlets are in compliance with state law. The most encouraging news out of Colorado is that the state has successfully implemented a $700 million marijuana market without any of the dire consequences that legalization opponents warned about. Fatal car accidents in the state are flat and well below the past decade's average. Crime is down in Denver and the surrounding area. While some societal effects of marijuana legalization may not make themselves fully known until several years down the line, the first year of legal weed in Colorado went about as well as anyone could reasonably hope. - --- MAP posted-by: Jay Bergstrom