Balancing Act | Seven Days | Vermont's Independent Voice

Balancing Act 
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Re: “Lawmakers Weigh a 25 Percent Marijuana Tax

An additional note about how they do it in Washington State: they collect tax revenue through a 25 percent tax on producer sales to processors; another 25 percent tax on processor sales to retailers; another 25 percent tax on retailer sales to customers; a state Business & Occupation (B&O) gross receipts tax; a state sales tax of 6.5 percent; and varied local sales taxes. The total effective tax rate to be about 44 percent because of how many times it gets "stepped on".

Posted by Balancing Act on 02/15/2016 at 6:05 PM

Re: “Lawmakers Weigh a 25 Percent Marijuana Tax

Whether 25% is an absurd rate remains to be seen. It has everything to do with what the cost of the actual product will be. Up until now, the price has had little to do with the actual cost of producing it--it's been based solely on what the market will pay and the black market automatically limits competition, creates scarcity and often introduces multiple middlemen/women. In Colorado last year they sold $1 billion of product and they collect tax revenue through a combination of a 15 percent excise based tax on the average wholesale market rate; a 10 percent state tax on retail marijuana sales; a state sales tax of 2.9 percent; varied local sales taxes; and local marijuana taxes such as a 3.5 percent tax in Denver. That's way more than 25% and yet they did a billion dollars worth of sales.

2 likes, 0 dislikes
Posted by Balancing Act on 02/15/2016 at 5:53 PM

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