Colorado raked in $60 million in marijuana taxes and licensing fees in the past year, plus saved most if not all of the $145 million the Harvard report estimated it spent each year fighting marijuana - PolitiFact rating: True

The debate over the legalization of marijuana is a lively one, with strong opinions on either side.

In a recent commentary in The Providence Journal, James Aubin, the founder of pro-legalization group Common Sense Citizen, argued for the legalization of  marijuana in Rhode Island, saying it could boost the state’s sagging economy.

He included an impressive statistic about the revenue Colorado was bringing in from marijuana sales.

"Colorado raked in $60 million in marijuana taxes and licensing fees in the past year, plus saved most if not all of the $145 million the Harvard report estimated it spent each year fighting marijuana," Aubin wrote in the Jan. 5, 2015, piece.

(The Harvard report he mentioned was "The Budgetary Implications of Drug Prohibition," a 2010 study by professor Jeffrey Miron. He estimated that Rhode Island spends $40 million annually fighting marijuana.)

We decided to focus on the first half of his statement, dealing with Colorado revenue.

We asked Aubin where he got his numbers. He responded that he relied on the State of Colorado's Department of Revenue, as well as a story from Channel 7-KMGH, the Denver ABC News affiliate.

We pulled Colorado’s tax records ourselves. We added up the monthly figures, from Jan. 1, 2014, when the first recreational marijuana stores opened, through Oct. 31, the most recent report.

We determined that the state’s total marijuana tax revenue was about $60 million.

The revenue comes from a 2.9-percent retail and medical marijuana sales tax; a 10-percent retail marijuana special sales tax; and a 15-percent marijuana excise tax, plus application and license fees for retail and medical marijuana.

In other words, Aubin got his number right. We were curious about where the money went.

Colorado tax records show that a portion of the revenue from marijuana retail sales  is distributed to local governments where stores are located, including Denver and the ski resort towns of Breckenridge and Telluride, based on tax revenue brought in from marijuana sales in those communities. Denver, for example, received $128,586.

Most of the money goes into the state general fund. But voters dedicated the first $40 million in excise taxes annually to a statewide school construction fund, administered by the state Department of Education. So far, that  tax has generated $10 million for the fund.

The monthly revenue from marijuana has increased steadily. In January, the total collected in taxes and fee was $3.5 million; in October, it was $7.6 million.

We also looked at news articles about the tax implications of legalizing marijuana. One, by Associated Press writer Kristen Wyatt, reports that estimates for tax potential from marijuana sales vary widely. States with legalized recreational marijuana sales could see their revenue drop as more states move to legalize.  

Another story, by Associated Press reporter Gene Johnson, detailed how tax revenues from legal sales of marijuana  were being undercut by regular users buying medical or black-market marijuana to avoid the higher taxes.

Officials in Colorado and Washington, two of the four states that have legalized sale of recreational marijuana, are  considering ways to rein in the medical marijuana system and to reduce the tax differential between medical and retail sales.

For the record, Rhode Island legalized medical marijuana in 2006. In 2013, it decriminalized possession of small amounts of non-medical marijuana; anyone caught with up to one ounce is subject to a $150 fine instead of facing a misdemeanor criminal charge.

Source:http://www.politifact.com