What Colorado’s First Marijuana Tax Numbers Mean for Us

The $2 million Colorado collected in January is either evidence for or against legalizing marijuana here in Massachusetts, depending on who you ask.

Lara Herzog

Associated Press

Massachusetts is one of a handful of states that may consider legalizing recreational marijuana on the 2016 ballot, so policymakers are looking to the experiments in Colorado and Washington for guidance. The release of Colorado’s first accounting numbers this week gives us some insight into the kind of cash windfall the state government might expect from the taxation of  weed should we allow its legal sale.

Colorado made roughly $2 million in marijuana taxes in January, the first month it was available for sale there, according to the Associated Press. Voters there demanded that some of that revenue go toward the construction of schools, but now they’re left deciding how else to spend it.

That seems like an enviable position to be in, but it’s complicated. For one, each state would have to decide how much to tax the product. Too little, and you don’t cover the additional costs the new industry incurs. Too much, and you don’t give much incentive for people to leave the black market. There’s also the matter of whether Colorado’s $2 million is actually all that much. If sales continued at that pace, revenue would be lower than Colorado officials had predicted, the Denver Post reports. With this being the first legalized weed market in the country, though, assuming that sales will remain stable is a big “if.”

As for Massachusetts, whether you see that figure as a sign we should hurry up and legalize probably depends on your previous position on the issue. Opponents argue that the tax revenue won’t cover the “social costs.”

“Of course, just like alcohol and tobacco revenue, we know that the sales of this intoxicant will bring in far less than the costs of its use,”  Rhode Island Congressman Patrick Kennedy said in a statement. Supporters counter by pointing to the social costs of keeping it illegal, like the cost of incarcerating and trying users of a drug that supporters say has fewer harmful effects than alcohol.

Those kind of cost calculations will take more than one month of legal sales to track.  Colorado’s first bit of data, in the end, doesn’t so much settle the debate about the gains and losses of legalization as fuel it.