The world has turned for marijuana, and the genie is out of the bottle, or should we say the smoke is out of the bong. May 2013 was a big month for those who actually inhale.
Colorado Governor John Hickenlooper signed two crucial bills, House Bills 1317 and 1318, stemming from the recent ballot initiative, Amendment 64, legalizing the recreational use of pot in Colorado, which lay out regulations for the sale and taxation of marijuana.
In Seattle, Reuters reports that ex-Microsoft strategist Jamen Shively announced plans to establish the first American pot brand, importing the weed legally from Mexico and retailing it in a chain of medical dispensaries and, where legal, retail outlets.
Shively's plans have the moral support of former Mexican President Vicente Fox, a conservative. Right now Shively is undertaking a press blitz in Mexico, where he plans to source his marijuana.
Very soon, Nevada could become the 14th state to legalize some form of medical marijuana. Governor Brian Sandoval is expected to sign legislation, SB 374, paving the way for opening medical marijuana dispensaries in the Silver State – up to 40 in Las Vegas alone.
And around the country events have transpired that suggest recreational marijuana may have a bright, lucrative future. The New York Police Department said they intend to de-prioritize pot busts, with pot-related arrests expected to drop a full 20% by the end of 2013.
The NYPD isn't alone. Police chiefs in big cities throughout the country have stated their preference to at least de-criminalize marijuana or put a lower priority on bot busts and focus on harder drugs. According to a Gallup poll, nationwide support for outright pot legalization has crossed the pivotal 50% threshold. A vigorous, healthy debate is underway across the country.
Marijuana: The Numbers Are Hard To Ignore
As events unfold, a bona fide emerging market in pot is taking shape. And the market is set to be big. The Colorado Futures Center estimates – conservatively – that the taxation regime outlined in the new Colorado marijuana laws could bring in as much as $650 million per year, much of that from a burgeoning new industry, pot tourism.
Colorado is noted for its rather low taxes, but it will be taxing marijuana aggressively and at many points in the production cycle, from grower to retail outlet. For instance, Colorado's sales tax is a modest 2.9%. Marijuana, however, will be assessed a 15% excise tax, as well as a 15% "special" sales tax – on top of the 2.9% state tax and any local taxes.
According to the Colorado Futures Center study, there's money to be made in that weed. Adults who choose to indulge can expect to pay around $185 per ounce. The study finds that the market will bear a wholesale cost of about $600 per pound, and retailers can expect a 175% markup.