Robert Celt
New Member
Taxes on the sale of recreational marijuana blew past expectations in the first month they were collected, totaling $3.4 million in January instead of the projected $1 million. Several factors may account for the unexpectedly large flow, including some that suggest revenues will dip. But even if collections remain at their initial level, marijuana taxes will provide no more than an incidental source of support for public services.
It's not surprising that tax projections were wide of the mark; state authorities have no benchmarks for calculating marijuana tax revenues. But a first-month burst might have been predicted – some Oregonians undoubtedly bought legal marijuana in search of a novel never-thought-the-day-would-come experience and won't become regular customers. During the startup period, the state allowed medical marijuana dispensaries to sell recreational pot; these sales are taxed at a 25 percent rate, higher than the 17 percent rate that will be collected from the recreational marijuana outlets that will open next year.
Still, $3.4 million is a lot of money – if revenues continue to flow at that rate, marijuana sales will generate $81.6 million per biennium. But from that amount, the startup and ongoing costs of the Oregon Liquor Control Commission's regulatory system must be deducted. Net revenues will then be split six ways: 40 percent for schools, 20 percent for mental health programs, 20 percent to be split between cities and counties, 15 percent for the state police and 5 percent for the Oregon Health Authority. The current biennial budget for schools is $7.4 billion; even at January's rate, marijuana taxes will provide less than one-half of 1 percent of that amount.
Oregonians voted to legalize recreational marijuana for reasons other than generating tax revenue. They ended prohibition in order to bring the underground marijuana economy into the open, to ease the burden of criminalization on the public safety system, and to stop ruining the lives of people arrested for minor marijuana offenses. Tax revenue will be welcome, but it won't become a primary source of public funds and was never meant to be.
News Moderator: Robert Celt 420 MAGAZINE ®
Full Article: Oregon Pot Taxes Are No Bonanza
Author: Editorial
Photo Credit: Brent Lewin
Website: The Register-Guard
It's not surprising that tax projections were wide of the mark; state authorities have no benchmarks for calculating marijuana tax revenues. But a first-month burst might have been predicted – some Oregonians undoubtedly bought legal marijuana in search of a novel never-thought-the-day-would-come experience and won't become regular customers. During the startup period, the state allowed medical marijuana dispensaries to sell recreational pot; these sales are taxed at a 25 percent rate, higher than the 17 percent rate that will be collected from the recreational marijuana outlets that will open next year.
Still, $3.4 million is a lot of money – if revenues continue to flow at that rate, marijuana sales will generate $81.6 million per biennium. But from that amount, the startup and ongoing costs of the Oregon Liquor Control Commission's regulatory system must be deducted. Net revenues will then be split six ways: 40 percent for schools, 20 percent for mental health programs, 20 percent to be split between cities and counties, 15 percent for the state police and 5 percent for the Oregon Health Authority. The current biennial budget for schools is $7.4 billion; even at January's rate, marijuana taxes will provide less than one-half of 1 percent of that amount.
Oregonians voted to legalize recreational marijuana for reasons other than generating tax revenue. They ended prohibition in order to bring the underground marijuana economy into the open, to ease the burden of criminalization on the public safety system, and to stop ruining the lives of people arrested for minor marijuana offenses. Tax revenue will be welcome, but it won't become a primary source of public funds and was never meant to be.
News Moderator: Robert Celt 420 MAGAZINE ®
Full Article: Oregon Pot Taxes Are No Bonanza
Author: Editorial
Photo Credit: Brent Lewin
Website: The Register-Guard
