When Colorado legalized marijuana in 2012, the state told voters that it could earn $70 million in tax revenue from the drug. That was wrong. The actual figure is likely to be 40 percent higher: $98 million in sales tax. Lots of green! Higher than expected! More money in the pot! And so on.
The Denver Post happily avoided stupid puns in its report. The new figure comes from Gov. John Hickenlooper's 2015 budget, which carves out a portion of that windfall into programs ensuring that any negative effects of legal pot are minimized: $45.5 million for youth use prevention; $40.4 million for substance abuse treatment.
Slate's Matt Yglesias wonders if the bonanza might be masking a decline in taxes from other places — namely, decreased alcohol consumption. "To the extent that legal marijuana displaces legal booze purchases, you're going to see an offsetting decline in alcohol tax revenue," he writes. "Which would be fine — a big win for public health, in fact—but not quite the financial bounty states may be hoping for." In Colorado, recreational marijuana is subject to a 12.9 percent sales tax by the state while alcohol is taxed at the same 2.9 percent as any other good. Meaning that even a significant decline in alcohol consumption could be easily made up for by marijuana proceeds. Assuming that there exists a large population of people that only drank socially because marijuana was illegal. Speaking anecdotally, that seems unlikely.