In a move that will affect hundreds of marijuana businesses in the state, Colorado’s governor signed a bill into law that will raise the retail cannabis sales tax from 10% to 15%.
The tax hike – which potentially could damp retail cannabis sales – is part of a broader legislative package to fund Colorado’s rural hospitals, schools and roads, Colorado Springs TV station KRDO reported.
Under the new law, Colorado cannabis retailers must now charge a 15% sales tax for MJ products on top of a 15% marijuana excise tax, a 2.9% “tangible personal property” sales tax as well as local sales and excise tariffs.
Approval of the law contradicts a statement Gov. John Hickenlooper made earlier this year when he expressed concern that higher marijuana taxes could lead the state’s consumers to seek out illicit cannabis, according to KRDO.
“I don’t think we can raise additional tax dollars for marijuana,” he said in February, “because then it raises the price, and that means we have more black market marijuana.”
Colorado’s new law allocates nearly $2 billion for roads over the next 20 years, $530 million for Medicaid reimbursements to hospitals, and $30 million for schools.