Colorado’s Taxpayer Bill of Rights Forces Tax Holiday in September
June 4th, 2015
Policy, Top News
The State of Colorado will waive its special 10% tax on recreational marijuana on September 16th in order to comply with its Taxpayer Bill of Rights – the same rules that could force it to refund tax revenue to voters. Marijuana sold on that day will be subject to regular sales and local taxes, however, which are usually charged in addition to the 10% special tax on the drug.
Governor Hickenlooper is set to sign a bill (HB 1367) this week that will comply with the obscure provisions in the Taxpayer Bill or Rights. In addition to these changes, the same bill will seek to lower the 10% special tax to 8% starting in 2017. The reduction is aimed to curbing the black market for marijuana that still exists in the state despite legalization.
The bill will also create a 2015 ballot question asking voters to block a marijuana tax refund even though they are entitled to it under the Taxpayer Bill of Rights. Last year, the government collected about $58 million in tax revenue, which was about $10 million less than experts predicted. About $40 million of that amount was slated for schools and other efforts.
If the tax refund is not blocked, individual taxpayers would receive $25 million – or about $6.10 per adult; marijuana consumers would get $13.3 million in the form of a tax break on any pot purchases; and, marijuana growers would get $19.7 million in the form of a refund on the excise tax paid to the state before it ever reached store shelves.
In the end, Colorado’s Taxpayer Bill of Rights has created a bit of a headache for the government’s implementation of cannabis legalization early on, but the bugs should be ironed out moving forward to prevent any future problems.
This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.
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