Cannabis shops in Colorado’s third-largest city face higher tax rates heading into the new year, which some business owners say will drive up the price of legal cannabis well above rates on the black market.
As of Jan. 1, recreational marijuana stores in Aurora will be required to pay a 5% excise tax and a 2% sales levy, in addition to state taxes, according to The Denver Channel. The additional taxes will raise revenues for the city by an estimated $2.4 million a year.
Local voters approved the taxes in the November elections.
One Aurora retail shop owner told The Denver Channel that the increase will force businesses to raise prices, which could deter consumers from obtaining marijuana legally.
“If people have to pay too much in taxes, they’ll go back to the black market and we’re going to lose the tax money anyway,” said Jamie Perino, the owner of Euflora, a retail shop in Aurora. “And we’re going back to funding that market.”