The Economics of Regulation and Taxation

Colorado will benefit tremendously from taking the profit out of the lucrative marijuana black market. At present, illicit drug dealers reap tremendous profits from the marijuana market in Colorado. Through state regulation, this revenue can be taken from the hands of illicit dealers and used to fund better treatment and healthcare programs. We are currently researching the estimated tax revenue for Colorado if the state were to regulate marijuana sales. Estimates in other states include $16.9 million in Massachusetts¹, $28 million in Nevada², and $1.5 to $2.5 billion in California³ each year in marijuana sales tax revenue. Colorado could use this revenue to promote healthy lifestyle choices and meet our alarming treatment deficit.

There are an estimated 250,000 people in the state of Colorado who would benefit from drug abuse treatment.⁴ Eighty-one percent of these Coloradoans are not receiving treatment.⁵ It will cost an estimated $10.5 million to close this gap⁶, but for every tax dollar spent on treatment, seven dollars in future costs are saved.⁷ Colorado needs to invest in the future by increasing treatment, prevention programs, and harm reduction education. Regulating and taxing marijuana would fund this investment.