The Oregon retail cannabis market has traveled a rough road since being legalized back in 2014. When the citizens of the state voted to legalize retail cannabis for adults over the age of 21, there was already an existing medical marijuana program in the state. In 2015, on October 1st, medical marijuana dispensaries in the state were able to start selling a limited selection and quantity of cannabis to retail consumers over the age of 21.
The Money is Rolling In Already
When sales began in October there were no immediate taxes applied to the sale of retail cannabis. This changed on the 1st of January when the state implemented a 25% sales tax on all recreational cannabis sales in the state. So far since January when they started collecting taxes, the state has collected almost 25.5 million dollars in taxes from retail or recreational marijuana sales. This figure was released on October 22nd by the Oregon Department of Revenue and includes the sale of all marijuana-based products, including marijuana-infused edibles which went on sale in June on the retail Market.
The 25% tax that is currently being charged on retail recreational sales in the state is expected to decrease to just 17% on October 1st. This is when the Oregon Liquor Control Commission takes over the regulation and oversight of the recreational market. The state is estimating that by the end of the year they will have collected roughly 44.4 million dollars in marijuana taxes. Not too shabby for the first year of taxed sales in the state!
According to estimates, it is going to cost the state almost 29 million dollars to regulate marijuana of which 12 million will be covered by retail cannabis taxes. The remaining balance will be covered utilizing the money that comes from licensing marijuana businesses in the state. Whatever is left from the marijuana taxes at that time will be distributed according to the original laid out formula in the law.
Where All the Money Is Going to Go
The law states that 40% of the taxes will go to the state’s common school fund and 20% of the taxes collected by the state will be used for mental health, drug, and alcoholism services. 15% of the left over taxes will go to the Oregon State Police, 10% will be going to city law enforcement and 10% will go to county level law enforcement officers. The remaining 5% will go to the Oregon Health Authority for early intervention, prevention, and treatment services for alcohol and drug abuse.
image credit: merryjane.com