Here Come the Pot Taxes

Beginning next year, stores with special permission from the State can sell cannabis. But before that happens, voters in Colorado will decide whether to approve Proposition AA. The new law would impose a new tax of 30 percent. But that’s not all. Question 2A in Denver would authorize an additional sales tax of up to 15 percent to go to the city bureaucrats. That’s not in place of, but in addition to, the taxes that already apply to everything else. If all these taxes are approved and legislators set them at the maximum authorized levels, legal pot in Denver—home to most of the state’s medical marijuana centers, the only businesses that will initially be allowed to serve the recreational market—will be hit by a total sales tax of 38 percent, plus an excise tax of 15 percent. Now Denver attorney Rob Corry is campaigning to get Colorado Pot-smokers to vote NO on Proposition AA to avoid what he calls, quote, “the largest tax increase in Colorado history.” Unfortunately, Amendment 64, the ballot measure that Coloradans voted for last year, grants state agents the authority to tax and regulate cannabis in a manner similar to alcohol. But what happens if bureaucrats regulate the price of cannabis higher than the black market price? Will consumers go back to their old dealer for the better price?