Michigan Officials: Legal Marijuana Will Create Even More Revenue Than Activists Predicted

Michigan Officials: Legal Marijuana Will Create Even More Revenue Than Activists Predicted

If Michigan voters elect to legalize marijuana in November, the state can expect to collect hundreds of millions of dollars in tax revenue over the next five years, according to a new report from the non-partisan Michigan Senate Fiscal Agency.

In fact, the new estimates are even higher than those projected by the group sponsoring the legalization ballot measure.

While that group, Regulate Marijuana Like Alcohol In Michigan, predicted that the state would collect about $520 million in cannabis sales and excise tax revenue in the five years after implementation, the government estimate is closer to $730 million over the same time span.

Michigan Senate Fiscal Agency

Via Michigan Senate Fiscal Agency.

The initiative, Proposition 1, would impose a 10 percent excise tax on non-medical cannabis sales in addition to the state’s six percent sales tax. It would also eliminate a three percent tax on medical cannabis “provisioning centers,” which was accounted for in the fiscal report.

Where would all that money go?

The 10 percent excise tax revenue would be distributed for transportation infrastructure (35 percent), schools (35 percent) and local jurisdictions that permit adult-use marijuana businesses to operate in their municipalities and counties (15 percent each).

Based on the government report, that means that by the 2022-23 fiscal year, out of of $252 million in total marijuana tax revenue, about $126 million will go toward road construction and K-12 education funds on an annual basis from the excise tax alone. On top of that, schools would receive an additional $77 million a year due to marijuana commerce, allocated from the state’s six percent sales tax.

Then, of course, there’s the cost savings of simply ending marijuana arrests and related prosecutions and incarcerations, as the Michigan Senate Fiscal Agency noted. The proposition “could have a positive fiscal impact on State and local government,” according to the report.

“Fewer felony arrests and convictions could decrease resource demands on court systems, community supervision, jails, and correctional facilities. In 2016, 199 people were sentenced to prison for a marijuana-related felony conviction, and 3,620 were sentenced to jail, probation, or a combination of both.”

The chances that Michigan ends up legalizing marijuana for adult-use seem fairly strong. A September 2018 poll from The Detroit News and WDIV-TV found that 56 percent of likely Michigan voters favor fully legalizing cannabis, compared to just 38 percent who said the opposed ending prohibition.

See the original article published on Marijuana Moment below:

Michigan Officials: Legal Marijuana Will Create Even More Revenue Than Activists Predicted

Colorado Marijuana Sales Generating More Annual Tax Revenue Than Liquor

Colorado Marijuana Sales Generating More Annual Tax Revenue Than Liquor

On the heels of a statewide “marijuana tax holiday” on September 16, it was announced that Colorado has become the first state to generate a higher annual tax revenue from marijuana sales than from taxes imposed on liquor.

According to the Colorado Department of Revenue, from July 1, 2014 through June 30, 2015, the state of Colorado accumulated almost $70 million through marijuana-specific taxes, compared to slightly under $42 million in alcohol-specific taxes. Mason Tvert, the director of communications for the Marijuana Policy Project, believes that customers have earned the one day tax holiday,

“Marijuana taxes have been incredibly productive over the past year, so this tax holiday is a much-deserved day off. This will be the one day out of the year when the state won’t generate significant revenue. Over the other 364 days, it will bring in tens of millions of dollars that will be reinvested in our state.”

While it is true that most cannabis customers spend more to purchase marijuana than they do alcohol, the nearly 28 percent tax on every cannabis sale offers an explanation to the considerably larger annual revenue marijuana produces.

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