Skip to content

Where Does Colorado Cannabis Tax Money Go?

Colorado Cannabis & The Federal Tax Code

Yes on Recreational Legalization in 2022

Colorado citizens can register to vote online or in person through election day

Resources

Colorado state tax revenue from the legal cannabis industry surpassed $2 billion in January and the state has collected more than $88.7 million in fees.

In addition to state and local taxes and fees, cannabis businesses have an effective federal tax rate of about 70% – compared to about 26% for other businesses. 

Did you know Colorado legal cannabis dispensary owners are unable to deduct normal business expenses like payroll and rent from their federal income taxes?

Marijuana has contributed over $320 Million dollars to Building Excellent Schools Today (B.E.S.T.), making up about 25% of the program's entire budget.

In FY 21-22 alone, nearly $15.3 million in state cannabis dollars went to state Affordable Housing Grant and Loans.

The Marijuana Tax Cash Fund collected $188.8 Million in FY 2021-22 alone.

In FY 21-22 alone, nearly $15 million in cannabis dollars went to the School Health Professional Grant program. 

More than $15 million in cannabis dollars went to substance abuse treatment in FY 21-22.

More than $1.6 million cannabis dollars went to the Tony Grampsas Youth Services Program in FY 21-22.

Voters in 59 of 64 Colorado counties voted no on Proposition 119 sending a clear message against raising taxes on cannabis consumers.

Unlike other legalized substances, the marijuana industry has a 97% compliance rate for unauthorized sales.

Unlike alcohol, research has proven you can only get “so high.” Cannabinoid receptors in your brain eventually prevent the body from getting further intoxicated.

Did you know? Since legalization in 2005, teen use in Colorado has remained flat and is below the national average.

According to a recent poll by the Pew Research Center, more than 90% of Americans think cannabis use should be legal.

Did you know? MIG represents more than 400 cannabis business licenses across the state.

A 2021 study found that medical cannabis use was associated with clinical improvements in pain, function, and quality of life with reductions in prescription drug use. 

Founded in 2010, MIG is the oldest and largest trade association for licensed cannabis businesses.

Colorado’s marijuana model has become the example for all other regulated cannabis states, and MIG works directly with policy makers to ensure that Colorado’s program is fair, tightly regulated, safe, and successful.

Safe Sales: Every marijuana sale in CO takes place on camera and requires multiple ID checks.

All regulated marijuana in Colorado is tracked from “seed to sale,” with oversight from the Marijuana Enforcement Division.

Established in 2010, MIG has led legislation for child resistant packaging, customer safety resources, and purchase restrictions for 18-20 year olds.

Marijuana is taxed at both state and local levels. This year Aurora built a new $34 Million dollar rec center, fully funded by local marijuana taxes.

The marijuana industry suffers from unfair Federal tax rules, which means that MIG members’ effective tax rates are around 71%.

A 2019 study showed that crime does not increase with legalization.

Conditions for medical marijuana

Cancer - Glaucoma - HIV or AIDS - Cachexia - Persistent muscle spasms - Seizures - Severe nausea - Any condition for which a physician could prescribe an opioid - Autism Spectrum Disorder - Severe pain - PTSD

Most marijuana businesses have access to banks, but because marijuana is still federally illegal, businesses are unable to access merchant processing services such as VISA or Mastercard.

Consuming higher potency marijuana does not lead to higher levels of impairment.
-- Journal of the American Medical Association (JAMA) 2020

71% of Colorado voters favor marijuana legalization. This has increased 10 points in the last four years alone.

Marijuana Industry Group Responds to Continued Decline in Cannabis Sales

MIG Press Release

FOR IMMEDIATE RELEASE

DATE: May 10, 2022

CONTACT: Madeleine Schmidt

 

Marijuana Industry Group Responds to Continued Decline in Cannabis Sales

Cannabis Sales Continue to Drop from 2021 With Medical Sales Down 43%

 

DENVER – Sales figures released Monday by the Colorado Department of Revenue continue to reveal a troubling trend for a critical Colorado industry. Cannabis sales are on the decline from 2021 as business owners and consumers grapple with ever-increasing taxes and burdensome regulations. 

 

The state recorded $162.5 million in total sales for recreational and medical marijuana in March of this year compared to $207.1 million in March of 2021, a 21% drop. Medical sales saw a particularly sharp decrease, with just $22.9 million in sales for this March compared to $40.4 million in 2021, a 43% drop. 

 

“This continued decline in sales, particularly in the medical market, is highly concerning, and we need to do everything we can to help businesses stay afloat and ensure medical patients can get the treatment they need,” said Tiffany Goldman, Board Chair of the Marijuana Industry Group. “We hear from our members every day that they can’t cope with the high taxes and burdensome regulations that make it exceptionally difficult for small businesses to survive in this industry. Moving forward, we need to ensure we’re not regulating the industry out of existence.”

 

A law that went into effect at the beginning of the year that added regulations for medical clinics, HB-1317, is making it increasingly difficult for patients to access treatment. 

 

“HB-1317 may have been well-intentioned in keeping cannabis out of the hands of young people, but it has had devastating consequences for Coloradans who rely on medical cannabis for debilitating chronic conditions for which there is no other effective treatment available,” Goldman said.

 

In addition to a volatile economy and supply chain issues, Colorado cannabis businesses face a unique set of financial challenges, including a state tax rate of 30% in addition to local taxes and fees, a federal tax rate of over 70%, and a growing list of regulations. Revenue from the industry surpassed $2 billion earlier this year.

 

“While I’m proud that this industry has generated critical revenue to fund much-needed initiatives relating to education, public safety, mental health, and more, we need to ensure businesses can keep operating and generating this revenue for many years to come,” Goldman said.

 

Cannabis sales declined in February as well, down 13% from February of 2021. Medical sales in February dropped 37% from 2021.

 

###

 

About MIG: MIG was founded in 2010 by cannabis business owners and supporters who wanted to help craft Colorado’s earliest medical marijuana regulatory framework. MIG is the oldest and largest trade association for licensed cannabis businesses. Comprised of approximately 500 licensed businesses, MIG has strong representation and connections across the state. MIG advocates on behalf of the rapidly evolving needs of the regulated marijuana industry in Colorado with a reputation for innovative policy making and getting results for the state’s cannabis community.

Powered By GrowthZone