Report: Marijuana Legalization Battering Black Market in Colorado

Marijuana legalization is “crushing” the black market in Colorado, but the same hasn’t been true so far in Washington State, according to research cited in the Economist.

Annual legal cannabis sales in Colorado account for about 70% – or 90 tons – of all marijuana sales in the state, according to officials there, the magazine reported. Most of the rest is attributable to people who grow marijuana legally at home but then sell it illegally, creating what the Economist calls a “gray market.”

By contrast, only about 30% of marijuana sales stores in Washington were made in the legal market, according to Roger Roffman, a researcher from the University of Washington’s School of Social Work, cited in the magazine’s report.

Why the difference?

Washington has a huge unregulated medical cannabis industry and initially assessed sky-high taxes on recreational marijuana. But the state is stamping out its illegal MMJ industry and has lowered taxes.

Cannabis taxes in Colorado have been low enough to compete with the black market, and it has a well-regulated, legal MMJ industry as well.