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6 Nov, 2013 16:50

Colorado votes for super-tax on marijuana

Colorado votes for super-tax on marijuana

One year after deciding to legalize the recreational use of marijuana, Colorado voters have approved a new measure taxing the drug.

Marijuana in Colorado will be labeled with a 15 percent excise tax and a 10 percent sales tax. With 96 percent of the precincts reporting, the measure is passing by a count of roughly 65 to 35 percent. Medical marijuana will still be sold at a lower rate throughout the state.

A local ballot measure in Denver was also approved by a wide margin, adding an additional 3.5 percent sales tax on recreational pot sold within city limits.

The statewide taxes are expected to bring in roughly $70 million annually, which will be used to fund school construction programs and enforcement of the law. The first $40 million will be set aside for school projects.

"We are grateful voters approved funding that will allow for a strong regulatory environment, just like liquor is regulated," said Democratic Gov. John Hickenlooper to Reuters. The governor originally opposed legalizing marijuana, but has come out in support of the tax proposal.

"We will do everything in our power to make sure kids don't smoke pot and that we don't have people driving who are high. This ballot measure gives Colorado the ability to regulate marijuana properly,” he added in a statement.

While the tax measure passed easily, it did force a split within the marijuana community. Some groups, like the National Organization for the Reform of Marijuana Laws (NORML), aren’t opposed to taxes themselves, but felt this particular proposal went too far.

"This is not keeping with the promise to tax marijuana like alcohol," Rachel Gillette, president of the Colorado chapter of NORML, said. "It's more like regulating the sale of plutonium than alcohol. It looks like a law-enforcement money grab."

Beer is taxed at eight cents per gallon in Colorado, while wine and liquor are 28 cents and $2.28 per gallon, respectively.

In the lead-up to the vote, supporters of the tax claimed that since most people don’t smoke marijuana, communities would need to see tangible benefits as a result of legalizing the drug. Collecting taxes in order to improve the state’s schools and ensure the law is enforced properly is integral to the long-term success of the law, they say.

"This was the last piece of this marijuana policy marathon, the last leg," Rep. Dan Pabon said to the Huffington Post. "It’s part and parcel to all the work we did in the regulatory piece, because if you don’t have means to enforce this, the laws will be rendered meaningless and this is the last critical piece to the work the legislature did."

The key question that remains is whether or not heavy pot smokers will continue buying the drug on the black market in order to avoid taxes. Past studies have shown that roughly 80 percent of all marijuana is smoked by 20 percent of users, meaning the behavior of routine smokers could have an important impact on the law's success.