How much pot will Coloradans consume once it becomes widely and legally available?
About 150,000 pounds a year, according to a new study by the Colorado Futures Center at Colorado State University. The study warns its estimate is probably conservative.
Put another way, that’s roughly 672 million bong hits per year, which may generate as much as $130 million in tax revenue.
But despite the best efforts of Colorado pot smokers, not even that amount of toking is expected to produce enough revenue to cover the costs of regulating the industry, much less contribute to other areas of the state’s balance sheet.
“Revenue from marijuana taxes will contribute little or nothing to the state’s general fund,” the report concludes.
Lawmakers are currently considering a one-time excise tax of 15 percent applied at the point of sale between the cultivator and retailer and a 15 percent special tax paid at the cash register along with a 2.9 percent state sales tax.
Voters must approve the taxes during the election in November before they can be applied.
The good news for cannabis aficionados is that even after taxes are added, CSU researchers estimate that regulated pot will retail for less than the black market, at around $187 per ounce. According to the crowdsourcing website Price of Weed, the average price of high- and medium-quality marijuana from the Colorado street market is $219 per ounce.
If the CSU forecast is correct in its assumptions about the pot market, the excise tax will earn the state $21.7 million per year, which is earmarked (up to $40 million) for school capital construction; $90.9 million from the special tax to be shared with the localities that haven’t banned retail pot stores from within their borders; and $17.6 million from the existing sales tax that will be used to fund enforcement and regulation.