The state of Colorado legalized cannabis for recreational adult use in 2014 and since then the industry has grown significantly, creating jobs and generating a substantial revenue from taxes paid. Governor Jared Polis recently stated in a tweet, that “we want Colorado to be the best state for investment, innovation and development for this growing economic sector”.
The official numbers show that licensed cannabis retailers have made sales worth more than $6,5 billion for the past 5 years. That activity has generated a little over a billion dollars in taxes and fees, which in return allowed the state to invest in the prevention of youth consumption, public health and public school construction. All this on the back of 2.917 licensed marijuana businesses and more than 41 000 licensed workers in the industry.
As shown in the graphs below, tax revenue has been growing steadily every year. Since July 2017 the monthly revenue from marijuana sales has never dipped below $20 million, reaching all-time high in April of this year.
Currently more than 30 states allow medical marijuana use, while only ten have approved cannabis for recreational adult use and benefit greatly from the economic development and growth of the industry. The state of Illinois is joining them in 2020 and becomes the second state (next to Vermont) legalizing marijuana through legislation and without voter referendum. This measure was taken to a certain degree to help and resolve the fiscal crisis which Illinois is going through. Legalization advocates point out that fiscal benefits is just one of many good reasons for changes in legislation.
Of course, the act of legalization alone isn’t a panacea; apart from the typical challenges every business meets in the beginning, the legal industry also has to fight the black market. As Gov. Polis pointed out in an interview with the CNBC, the key is in the development of a broad economic engine “that 10 years from now point-of-sales systems, chemistry, genetics — all those pieces — are housed here in Colorado with successful companies that power a multibillion national industry.”
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