State Of Colorado Has More Marijuana Tax Money Than They Know What To Do With

The legalization of both recreational and medicinal marijuana sales in Colorado was meant to bring about in an influx of tax dollars that lawmakers had earmarked for use on the state’s school system. However when all of the dollars and cents were added up, the money generated by sales of the drug surpassed the limit that current legislation imposes on the government’s tax revenue. The law uses population growth and inflation in order to cap the amount of tax money spent by the state government; and could send as much as $30.5 million back to Colorado taxpayers as a refund.

Are Taxes Too High?

Currently, all sales of marijuana are taxed at 25 percent with 15 percent of that cash set to fund education throughout the state. The high tax rate has been criticized by those within the industry, as they claim the significantly higher price of regulated marijuana makes illegal pot sales more attractive. 

Lawmakers argue that the tax rate is a part of the reason the public legalized marijuana sales in the first place. The tax revenue generated from those sales was intended to benefit the public by funding programs that are important to the voters, like education.

To Refund Or Not To Refund

Now the state is faced with determining how to proceed with this influx of money. Government officials argue that the tax law prohibiting the state from spending the excess money should be amended as voters have already agreed to use those funds for education. Once the state’s final tax estates are released in March, Colorado policymakers will likely work to pass an amendment to the tax code that exempts marijuana tax revenue from being included in the government’s total, which would allow the state to spend marijuana sales taxes on education as promised.