Today, the Nevada Tax Commission adopted temporary regulations proposed by the Department of Taxation allowing the state to issue recreational marijuana licenses by July 1, 2017. The ballot measure requires the state to initiate sales by January 1, 2018, but this “early start” program will allow businesses to open six months sooner.
Only medical marijuana establishments that are already in operation can apply to function as recreational retailers during the early start period. The establishments must be in good standing and must pay a one-time, nonrefundable application fee as well as a specific licensing fee. The establishment must also provide written confirmation of compliance with their municipality’s zoning and location requirements.
The tax department plans to accept applications from May 15 to May 31 of this year, and a second application period is anticipated later in the year. The incentive for the early start program stems from Gov. Brian Sandoval’s proposed budget request, which includes $70 million from recreational marijuana taxes over two years to support education.
Now, the focus shifts to local governments given that marijuana companies need both a state and local license to operate.
The Colorado Department of Revenue’s announcement that $1.3 billion in regulated marijuana sales took place in calendar year 2016, generating nearly $200 million in state tax revenue. These figures do not include millions of dollars in revenue generated by local taxes on marijuana.
The Cannabist reports:
To put the state’s third year of regulated recreational marijuana sales in perspective, Year One totaled $699.2 million (combined with medical sales) and Year Two jumped up to $996.2 million. The trend should continue in Year Four, but beyond that? It’s a murkier proposition.
2016 was the year in which the $100-million-month became a baseline and heralded a record-breaking summer: The combined sales for July, August and September were $376.6 million.
Monthly sales topped $100 million in eight of the 12 months. In December, which is typically a strong month for cannabis transactions, pot shops’ sales were a little more than $114.7 million, a 13 percent increase from the $101.3 million recorded in December 2015.
MPP's Mason Tvert had this to say:
“Over one billion dollars in marijuana sales that once took place in the underground market were instead conducted in regulated businesses this year. The state received nearly $200 million in marijuana tax revenue, whereas just a decade ago it was receiving zero. Hopefully this will be a wake-up call for the 42 states that still choose to force marijuana sales into the criminal market and forego millions of dollars in tax revenue.
“Marijuana tax revenue is not going to cover the state’s budget, but it is going to cover important programs and services that would otherwise be left out of it. This money is just the tip of the iceberg. The state is also reaping the invaluable public health and safety benefits of replacing an underground market with a tightly regulated system. Marijuana is now being sold in licensed businesses, rather than out on the street. It is being properly tested, packaged, and labeled, and it is only being sold to adults who show proof of age. The system is working.”
Legal marijuana businesses in Colorado made more than a billion dollars in sales during the first 10 months of 2016, exceeding sales numbers from last year.
The Cannabist reports:
Recreational and medical cannabis shops in America’s first 420-legal state have sold nearly $1.1 billion of marijuana and related products in 2016, according to the new October data from the state’s Department of Revenue.
When 2015’s year-end marijuana tax data was finally released in February, Cannabist calculations showed $996,184,788 in sales at Colorado marijuana shops that year — spurring a leading industry attorney to tell us at the time, “I think it’s ethical to round that up to a billion.”
That same lawyer, Vicente Sederberg partner Christian Sederberg, celebrated the billion-dollar news on Monday by also pointing to the Colorado cannabis industry’s increasing economic impact and skyrocketing tax revenues for the state as well as numerous cities and counties throughout Colorado.
“We think we’ll see $1.3 billion in sales revenue this year,” said Sederberg, “and so the economic impact of this industry — if we’re using the same multiplier from the Marijuana Policy Group’s recent report, which is totally reasonable — it suddenly eclipses a $3 billion economic impact for 2016.”
In addition to creating economic benefits, including state and local tax revenue and thousands of jobs, this legal market is on pace to continue stripping billions of dollars a year from the criminal market.