Legal pot sales has had some interesting consequences for Colorado government revenue:
Colorado enacted rather strict regulations on the trade, with frequent oversight and inspections. (Partly to try to keep the Feds from coming down on them.) This is rather expensive for the state government. But it was all to be easily paid for by those taxes on pot sales, with extra left over for the state.
But open, legal pot sales, with free-market competition & advertising, and no payments to Mexican drug lords or corrupt police have resulted in prices considerably lower than expected.
Perhaps the original estimate of the prices was wrong, being based on the previous black-market price of pot. (And police figures on the “street value” of the drugs they had seized may have been rather exaggerated.) And since the taxes are a percentage of the selling price, state revenue has been lower than expected. Indeed, the revenue may even end up being less than the cost of the extensive regulation. Right now, high sales to visitors from other states (like the OP) are propping up the system. But that is expected to decrease eventually, especially if other states legalize pot sales.
The accuracy of this is somewhat questionable – it is based on my understanding of a friend’s report of gossip at a recent Government Finance Officers Convention. But an interesting development.
This thread astounds me. I’m from the netherlands, where weed selling is legally tolerated, but large scale growing and producing pot is not. And yes, that is inconsistent and encourages criminals to grow pot.
Recent there have been a few tentative legal trials to legalize growing pot, too. But it is still illegal, largely because of " what would our international allies say" .
But now i hear that your state not only sells pot, but- i assume?- also allows someone to grow it…how do these states solve the problems of production and drug toerism, and dissaproving neighbour states?
Colorado doesn’t care, becuause those tourists pay taxes on the pot they buy. And also stay in hotels, eat meals, etc. to contribute to Colorado’s economy.
It’s alleged that neighboring states, like Nebraska, are also doing well from the pot tourists – they post a lot of Highway Patrol cars near the border, to catch them and collect fines from them.
The GFO people didn’t mention doing that calculation.
Anyway, I expect Colorado was not commonly jailing people for basic level (non-dealing) pot possession that much – tends to fill up your prisons too much. As for “abolishing parts of the war on drugs”, that hasn’t really happened – the police are still pursuing that war, just on different drugs. I don’t know if there has been much cost savings there. (Possibly even a loss, given the reduction in fines revenue! Here in Minnesota, our Governor declined to push any pot legalization unless ‘law enforcement’ supported it. And of course they didn’t – as was pointed out, that’s 50% of their business!)
I’d love to see a report about this. I wonder who is inspecting what. The stores are by and large cash businesses and they don’t keep customer records. If there’s a lot of time and expense to oversight, it must focus on the transactions between the growers and the sellers, as there’s no data to audit on the buyers.
It’s a cash business because the Feds insist on that.
Most of the buyers would strongly prefer to use their credit/debit cards to pay, like they do for everything else. But none of the Colorado banks will process credit/debit cards sales from these businesses; they are afraid that the Feds will charge them with ‘facilitating drug sales’ or something. Apparently one way the Feds are trying to kill off this industry.
So the legal pot sellers are now talking about forming their own bank or credit union, and using it to process their credit/debit card sales. (I expect then that the Feds would try to put pressure on Visa/MasterCharge/AmericanExpress to not allow this bank to participate in their network.)
A half serious suggestion is that this is an attempt by police to drum up replacement business – businesses known to have large amounts of cash every day are attractive targets for armed robbery, like the bank robberies of Jesse James’ day. So police can report on the big increase in armed robberies, and the need for increased police department budgets.
And I believe most of the legal pot sellers operate their own greenhouses to grow their own supplies, so there aren’t financial records of sales between growers & sellers. Often the growing takes place on the same property; some even offer tours. There’s quite a bit of hype about who has the best strains, the highest quality of plant care, etc. (A retired electrical contractor friend was astounded at the scope of the electrical installation needed for grow lights, ventilation, etc., and considered moving there to set go into business designing & installing better electrical packages for the industry!)
This has changed. 2 of the 3 stories I was in would accept credit cards, though I chose to pay cash.
My somewhat paranoid streak says you’re wrong that most people would want to use a credit or debit card. The idea that there would be a permanent record out on the web linking my name to purchases of pot (or pot stores) would not at all be attractive to me.
There is a kernel of truth to this, but only a kernel. Prices are down, but the state collected over $40M in taxes and fees last year, way more than enforcement expenses. What happened was the estimates were based on the number of licenses granted, but it took much longer for stores to open than most thought. There were only a handful of stores ready to open on Jan 1, mostly ones who were already in the medical market. This year, revenues could be triple last years. In January 2014, tax and fee revenues were $3.5M, while in Jan 2015, they were $8.8M.
I don’t see why they wouldn’t. But it’s not something I’d announce to the front desk clerk.
I live in Wyoming and I can confirm that highway patrolmen practically live at the Colorado border waiting to catch people with pot. You have to be very careful. But there is growing support for legalization, and it helped that the sky did not come crashing down on Colorado as many people here feared.
Consistently $20/gram ± $5. At least one place has a Sunday special at $10/gram. This is strong stuff, too. If I do more than 4 hits on a small pipe (like, maybe 1/10 gram?) I can’t think or even see well enough to watch a movie. Compared to liquor, it’s practically free.
I wonder if this will cut into liquor sales. I mean, think of how much less booze you have to buy for your party if a few grams will do the job cheaper.
I’m sure they’ll feel it from party folks who drink primarily for buzz (the Thunderbird & Night Train market). But I still like a few bottles of wine when I’m cooking, the occasional zombie before mowing the lawn, and Colorado has a booming microbrew culture–none of that is really the same niche as most liquor use, so probably wasn’t a good comparison to make in the first place. Where it’s gonna get wild is if/when the brewers start hopping with sativa buds.
At least for me, liquor and weed are two very different things. Also, I do not use cannabis, beer, vodka, etc to “do the job”. If I’m smoking, my beer consumption might be greater just due to thirst.