Colorado just avoided a 50-percent hike in the rate of tax on flowers or bud, from 62 cents a gram to 95 cents. An administrative tax increase was squarely on the table, put there by a finding of fact by Colorado’s Marijuana Policy Group. But the Department of Revenue rejected that finding and held rates steady.
This is an October 30, 2014, update, of a mid-August post:
Rates of $35 an ounce for potent flowers, $10 an ounce for less potent leaves, and $5 per immature plant: Those are the tax rates in Oregon’s Measure 91, which recently qualified for the November 2014 ballot. A reader asks: Are they too high? Are they too low? And how about the rate of $50 per ounce, reducible by regulations for (presumably less potent) parts of the plant, in Alaska’s Ballot Measure 2 (http://ballotpedia.org/Alaska_Marijuana_Legalization,_Ballot_Measure_2_(2014),_Full_text_of_initiative)? I’ll answer a different question. Alaska has an advantage other western states is that its internal laws don’t freeze voter-passed tax laws. Oregon’s law gives no advantage to voter-passed laws, and its 3/5 supermajority requirement for tax increases is less burdensome than some states’ rules.
How about those rates? To beat around the bush, the three hardest words in the English, according to Think Like a Freak, provide my answer. (Digressing further, the authors of that book, and of Freakonomics, feature my friend and Center for New Revenue board member Joe Murphy here: http://freakonomics.com/2012/12/06/the-things-they-taught-me-full-transcript/.) Continue reading Marijuna tax rates in Oregon and Alaska
Laws To Tax Marijuana — published version in State Tax Notes is the official version, but State Tax Notes would not print a Table of Contents, which is available in Laws To Tax Marijuana — Manuscript with Table of Contents.
The Federation of Tax Administrators, http://www.taxadmin.org/fta/about/default.html, folks who administer and collect state taxes, are having me on a panel about marijuana taxes for their Tobacco Tax section, in Knoxville, August 18. Final slides are at FINAL Oglesby FTA Tobacco section aug 18 noon slides for Knoxville.
A sin tax is “a sumptuary tax specifically enforced on a good which is addictive, self-destructive, and socially undesirable while raising revenue for pro-social activities.” http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2461189