Colorado Treats Buyers to One-Day MJ Tax Break
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Colorado Treats Buyers to One-Day MJ Tax Break
Posted by CN Staff on September 17, 2015 at 05:32:49 PT
By Julie Turkewitz 
Source: New York Times
Denver -- Some called it Christmas for stoners. Others warned of marijuana anarchy.Marijuana products across Colorado were nearly tax free on Wednesday — a one-time tax break forced by a quirk in the state Constitution. The break knocked away the state’s 10 percent tax on cannabis purchases — which is imposed on top of the existing state sales tax and any municipal taxes — and marijuana shops around the state spent months coordinating their distribution plans, advertising deep discounts in addition to the tax vacation and encouraging customers to start lining up at dawn.
“I’ve been saying ‘Happy holidays’ to everybody today,” said Mandie Farrow, 21, a dry cleaner employee who had just left the Grass Station, a shop that was offering 50 percent off on top of the tax break. She grinned as she waved her purchase — four grams of a marijuana concentrate stuffed in a white paper bag. Behind her, a line of eager customers snaked out the door, and a security guard with a silver badge had been told to expect a Black Friday-style event.“This holiday is off the charts,” said the guard, Kristian Adam, 47. “It’s right up there with 4/20 and the state’s visit from Phish,” he added, referring to April 20, a date associated with marijuana use.Colorado’s marijuana consumers owe their good fortune to the state’s Taxpayer’s Bill of Rights, a constitutional amendment that passed in 1992 as a way of limiting government growth.Among the amendment’s stipulations is one that says new taxes must be set back to zero if state tax collections exceed government estimates. When legislators learned that tax revenue had surpassed expectations in 2014, they voted to return marijuana taxes to zero — for one day — and then reinstate them. Voters gave the legislature the power to re-establish the tax when they legalized the recreational use of marijuana in 2012.“It’s a lost opportunity to be collecting money,” said State Senator Pat Steadman of the one-day arrangement, “but it’s part of our Constitution.”The tax break is a boon not only for customers, but also for marijuana growers, who are excused from paying a 15 percent tax on all sales they make to stores. On Wednesday, Subarus, minivans and armored trucks stuffed with marijuana crisscrossed the state as growers raced to get their product out of warehouses and onto store shelves before the close of business.At the Grass Station, workers unloaded their biggest shipment ever — at least 17 boxes containing prerolled marijuana cigarettes in glass tubes and marijuana flower in white medicine bottles.“I can only imagine what it looks like for the outside, for people who are not in Colorado,” the shop’s owner, Ryan Fox, 38, said by telephone. “They must think we’re crazy.”Customers still had to pay Colorado’s typical 2.9 percent sales tax on their marijuana purchases, as well as any municipal taxes. And as the law provides on any day, they were limited in the amount they could purchase at one time. Residents could purchase one ounce of marijuana (roughly a large fist-sized clump of flowers) and nonresidents could buy a quarter-ounce.Officials estimate the state will lose out on $3.7 million in tax collections because of the holiday.Not everyone is thrilled by the marijuana-selling frenzy. This week the editorial board of The Colorado Springs Gazette expressed concern about dangers caused by overconsumption on the tax holiday.“For advocates of marijuana anarchy, holidays don’t get better than this,” the editorial said, adding that “a sudden drug surplus stands to burden employers, law enforcement, schools, hospitals and responsible parents. It will undoubtedly make pot more available to kids, who can lose 8 IQ points with regular use. That’s neither magical nor funny. It is tragic.”Others, though, like Matthew Lopez, 33, who recently moved to Colorado from Laredo, Tex., said the tax holiday was just a part of Colorado’s quirky character. “The marijuana industry is the main draw for this state,” Mr. Lopez said, adding that he planned to work behind the counter at a marijuana shop. “Who wouldn’t want to be a budtender?”The tax break comes at a time when the state marijuana industry is booming. Sales hit $96 million in July alone, a record.It also comes as Colorado grapples with how to handle revenue earned from marijuana sales. The Taxpayer’s Bill of Rights requires the state to return money garnered from new taxes when yearly revenues are higher than expected — meaning $66 million in marijuana collections could go back to the public, instead of going to schools and other programs, as legislators had planned.In November, a ballot question will ask voters to give the state permission to keep the money, a measure Senator Steadman expects to pass.Tim Cullen owns Colorado Harvest Company, which has three marijuana growing operations and three shops, including one on a Denver strip that is increasingly known as the Green Mile for the prevalence of cannabis shops along the roadway.On Wednesday, he said in a telephone interview, his employees hauled about 300 pounds of marijuana out of his growing operations and into his shops in order to avoid taxes. He said all his stores had lines out the door in the morning. “We’re rocking and rolling,” he said.A version of this article appears in print on September 17, 2015, on page A16 of the New York edition with the headline: Colorado Treats Buyers to One-Day Marijuana Tax BreakSource: New York Times (NY)Author: Julie Turkewitz Published: September 17, 2015Copyright: 2015 The New York Times CompanyContact: letters nytimes.comWebsite: -- Cannabis Archives
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Comment #2 posted by rhino33 on September 24, 2015 at 12:02:49 PT
Go Colorado!
Colorado is a trail blazer. The whole world is watching!
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Comment #1 posted by The GCW on September 20, 2015 at 21:03:41 PT
Related news
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