How much money did Colorado make when they legalized weed?
February: Sales of cannabis in Colorado top $6 billion since legalization took effect five years earlier. June: Colorado surpasses $1 billion in tax revenue from marijuana sales since recreational use was legalized.
Did marijuana legalization boost tax revenue and the economy? In direct terms, yes. State-licensed marijuana sales in Colorado have totaled more than $13.4 billion since 2014, according to the Colorado Department of Revenue. That has generated nearly $2.3 billion in tax revenue.
Colorado's combined state and local general revenues were $69.3 billion in FY 2021, or $11,921 per capita. National per capita general revenues were $12,277. Colorado uses all major state and local taxes.
According to the document, which resides on the state's Colorado.gov website, retail MMJ sales in the State of Colorado were $199,118,715 for fiscal year 2012, generating $5,409,622 in state sales taxes.
One motivation for legalization is the economic benefits that can come from the regulated commercial availability of marijuana. Increased tax revenues, job growth, and investment opportunities all are powerful incentives to push for legalization.
Creating Tax Revenue, New Small Businesses, and Jobs
Colorado has generated more than $2 billion in state cannabis taxes since legalization, including more than $300 million each year since 2019. Washington State has generated over $3 billion in cannabis tax revenue and exceeded $500 million per year since 2020.
With the nationwide 'top 1 percent' earning threshold at $653,000, Colorado's threshold was well above that, ranking as the 7th highest '1 percent' threshold nationwide. Of the $709,092 or more that Colorado's '1 percent' earns, the median tax rate is 25.86 percent.
State Revenue Sources
Funding for Colorado's state budget comes from many different sources, including state taxes and fees, and funding from the federal government. The biggest source of revenue for the state are income taxes and sales taxes.
If you make $75,000 a year living in the region of Colorado, USA, you will be taxed $18,237. That means that your net pay will be $56,764 per year, or $4,730 per month.
| Year | Colorado state marijuana tax revenue |
|---|---|
| 2020 | $387,480,110 |
| 2021 | $423,486,053 |
| 2022 | $325,103,684 |
| 2023 (January-September) | $210,123,862 |
What does Colorado do with weed money?
Half a billion dollars later, cannabis taxes have changed Colorado. The biggest percentage is allocated for homelessness and housing. Nearly $9 million this year will go towards affordable housing in a city that's becoming increasingly unaffordable.
In Colorado, cannabis has been legal for medical use since 2000 and for recreational use since late 2012.
Habitat Loss and Fragmentation. Removing forest, grasslands, or other existing habitats for cannabis cultivation can cause wide-ranging impacts on terrestrial and aquatic ecosystems.
The movement to legalize has accelerated since 1996, when California became the first state to legalize medical cannabis. In 2012, Washington and Colorado were the first states to approve legal recreational use.
Businesses that sell retail marijuana to the public, also known as recreational marijuana, are required to file the Retail Marijuana Sales Tax Return electronically via Revenue Online(opens in new window); the sales tax rate is 15%.
“Colorado's cannabis market declines in recent years combined with the significant oversupply has caused the company to make the difficult decision to close operations in Colorado,” Coda Signature told Westword in a statement.
Colorado is currently ranked 25th in the United States for its economic outlook.
The living wage in Colorado is $16.54 per hour, or $34,488 per year. This is the hourly wage that a worker needs to earn to support themselves and their family. The living wage is higher than the minimum wage, but it is still below the average wage.
| 1 ADULT | 2 ADULTS (1 WORKING) | |
|---|---|---|
| 0 Children | 1 Child | |
| Living Wage | $20.25 | $38.47 |
| Poverty Wage | $6.53 | $11.07 |
| Minimum Wage | $13.65 | $13.65 |
Why is Colorado so rich?
The state's economy is diversified and is notable for its concentration of scientific research and high-technology industries. Other industries include food processing, transportation equipment, machinery, chemical products, minerals such as gold and molybdenum, and tourism.
The largest industries by revenue in Colorado are Oil Drilling & Gas Extraction, Tourism and New Car Dealers, which generated $37.4b, $26.9b and $21.5b in 2022.
| Rank | Company | Number of Employees |
|---|---|---|
| 1 | Macy's | 130,000 |
| 2 | RE/MAX | 100,000 |
| 3 | Catholic Health Initiatives | 78,000 |
| 4 | DaVita | 67,000 |
Assuming you work a full-time job, $19 an hour is $38,000 a year. The federal poverty guidelines in the US are $12,500 for a single person, $25,750 for a family of four. In order to be officially “poor” by federal standards, you'd have to be supporting a family of 7 on that single income.
| 1 ADULT | 2 ADULTS (BOTH WORKING) | |
|---|---|---|
| 0 Children | 2 Children | |
| Living Wage | $27.32 | $33.26 |
| Poverty Wage | $7.24 | $7.50 |
| Minimum Wage | $16.00 | $16.00 |
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