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Marijuana Business News

Legal Marijuana Tax Revenue Higher Than Predicted In Washington

marijuana taxes tax
(via dailyfinance.com)

The Washington legal recreational marijuana industry got off to a late start, and is still wracked with issues, but is getting bigger and better everyday. New projections are out about marijuana tax revenues in Washington, and they are higher than expected. Per the Huffington Post:

The most recent revenue forecast released by the Economic and Revenue Forecast Council shows that the industry is expected to bring in more than $694 million in state revenue through the middle of 2019. A previous forecast in September had that projection at about $636 million.

The latest report shows that nearly $43 million from a variety of marijuana-related taxes — including excise, sales, and business taxes — is expected to be collected through the middle of next year.

About $237 million is expected for the next two-year budget that ends mid-2017, and $415 million more is expected for the 2017-19 budget biennium.

I’m curious to see how Washington’s marijuana industry is affected by the rollout of legal recreational marijuana in Oregon. Washington sells marijuana for an astronomical price compared to what marijuana will be sold for in Oregon. I’m assuming when marijuana tourists will look at options in the Pacific Northwest, going to Oregon instead of Washington will be a no brainer considering marijuana is selling for $30 a gram in Washington, but will likely only be sold for $5 a gram in Oregon. Still, I’m encouraged by the tax numbers coming out of Washington, and hope to see projections continue to climb, and to see Oregon do the same.

  • Bill

    I live in Yakima Washington and the prices around here are 45 to 55 dollars per gram now that’s ridiculous that’s over $800.00 per ounce my brother lives in Colorado and says he pays $40 an eighth the dispensaries around here say it’s because of the lack of marijuana from the growers we need more growers and less taxes. I’m on Social Security disability and cannot afford those kind of prices

    • Jetdoc

      They’ll come down. It IS all about LACK of supply at present. Once the growers come online the prices will DROP. We’re paying $50/eighth right now in AZ and I’ve already noticed the prices coming down. It’s all about supply and demand!

      • David

        This doesn’t make sense when I can pick up a phone and have top-shelf bud (and many other cannabis products) delivered to my Seattle home in an hour or less for $45-50 an eighth. No medical authorization needed. I normally use one of Seattle’s 330+ excellent medical dispensaries. However, deliveries are open 24/ 7 hour’s, reasonably priced and convenient.

        • Jetdoc

          But are the “Delivery Services” LEGAL? Do they ride in the GRAY area of the law or are THEY totally black market? That’s a BIG difference. The people delivering to you don’t have the overhead, DON’T pay taxes, rent, have NO employees, obtain their product THROUGH the Black Market, NO licensing fees, NO stable business plan, NO start up investments, etc… I mean honestly it sounds like you’re still dealing with “drug dealers”?

          If you’re paying $5 more for an 1/8th and doing so TOTALLY LEGAL w/o ANY repercussions, you don’t wanna DO that? Being able to purchase it at THAT price AFTER their paying ALL the costs associated with doing business. You don’t wanna DO that? Think about it… the DELIVERY service is REALLY SCREWING you. Selling it you for slightly less than Dispensaries CAN and not having ANY of the costs associated w/dispensaries. That should tell you who’s really SCREWING who!

          Again, I’m NOT in ANY manner condoning the pricing structure. But I know for a FACT that when (LEGAL) Supply increases, prices WILL come down. It’s a statistical FACT!

          Secondly I’m attempting to get people to actually WAKE UP and LOOK at who’s REALLY screwing who between Dispensary pricing and Black Market pricing. Until WE (and that includes ME) quit patronizing “Drug Dealers” and abide by the rules that YOU VOTED FOR, the Black Market will never go away, prices will NEVER come down and you’ll STILL stand the chance of going to jail.

          I mean I’d pretty much GUARANTEE you that you voted FOR I-502, even with ALL of its warts! Think about it… you’d be PISSED if the people voted FOR I-502 and the State just said “there’s NO WAY we’re implementing this under ANY circumstances.” Think about what YOU are doing by continuing to support the “Black Market”?

          What you’re doing is… voting FOR the initiative, DEMANDING it’s implementation, wanting NO more people to go to jail for this, etc… Then when you GOT what you wanted, you told the State… “… I don’t CARE what I voted FOR! I THINK their prices are too high and therefore I’m going to CONTINUE to deal with the Black Market!” But I STILL WANT YOU (the State) to abide by the Law WE passed!

          Don’t you think that’s just a little hypocritical? We CAN’T vote for something then when it passes say… “never mind!”.

          • David

            Until recently Amazon would fit your description of illegality. According to a recent Seattle Times article, the state Legislature may decide to grant the City of Seattle regulatory over-sight for the 330+ medical marijuana dispensaries operating within the city’s limits. This would also include, “Grey Area delivery services” (number unknown) The State would then obviously assume regulatory oversight of area’s outside of the Seattle city limits. Local citizen’s (including myself) remain vehemently opposed to the state turning our excellent medical marijuana dispensary system into an over-commercialized adult recreational store system. Anyway, sounds like A win-win for everyone to me. By the way, I don’t use “Black-market”, or delivery services”. I have no reason to do so. I easily qualify for medical Cannabis under Washington’s medical marijuana law. I am also allowed to possess up to 15 plants + 64 ounces of flower’s. Many of my friends like using the cannabis delivery services. I’ve heard nothing but good things about them. What’s not to like ?

    • David

      If you’re on Soc. Sec. Disability you might consider getting yourself a Washington Medical Marijuana authorization. Your’re apparently paying tourist prices from recreational stores given the prices you’ve quoted. Here’s an example of what I currently pay for cannabis in Seattle using a medical dispensary located directly downstairs from my home (Convenient!). They offer excellent quality cannabis at reasonable prices. It’s$40- $48 an eighth for top shelf cannabis. If you like Oil concentrate’s Open Vape cartridge’s sell for $30. There are many varieties i.e. Vortex (Sativa) = 45% THC/ Bubba OG (Indica)=40% THC all kinds of medibles. You should easily qualify for a Washington authorization being on SSDI. Good Luck

      • Been there

        David, If you’re on SSDI, you have to submit to random urinalysis tests. If you fail, your benefits are revoked! I know from first hand experience on this matter.

        • David

          I have friends currently on two different types of federal Soc. Sec. disability programs: SSDI and SSI. They tell me those on SSDI are more likely to be subjected to the stupidity you are experiencing. On the contrary, those on SSI , not so much, unless they are called in for an independent medical examination. This sounds extremely discriminatory to me. Anyway, both friends on SSDI & SSI strongly encourage disabled persons to go ahead and obtain a State Authorization where possible. Makes sense. Although Federal drug laws trump State law in the administration of federal programs, an authorization would offer one more level of patient protection.
          I was also told that any patient’s currently taking opiate pain medication, and are on either SSI or SSDI are subject to random drug tests to determine if they are cutting back on, and / or selling their med’s for cash. My friend on SSDI has never been drug tested. However, he doesn’t take opiate’s for pain either, which apparently trigger’s a random drug test. He also said a great deal of what happens to a patient is left to the discretion of one’s primary care physician. Happy Holiday’s and Best of luck.

          • Been there

            SSI is administered by state (medicAID). SSD is administered by fed (mediCARE). Different rules. I don’t qualify for SSI but do qualify for SSD. I don’t take ANY medications but have been tested multiple times. Even the folks in Oregon that can help getting a card are unwilling to do so…

          • David

            I thought that SSI is considered the same Social Security Insurance that persons receive upon reaching retirement age ( whether there is a disability involved or not). Whereas SSDI, is intended for those having a disability who might not have met the Soc. Sec. work requirement rules, or have not worked enough years / hours to qualify for standard SSI (younger people who become disabled, or those who never paid into Soc. Sec). I guess I have the two mixed up. Anyway, I do know that Washington’s medical marijuana law doesn’t require patients to register with the state. The dispensaries, for their own protection normally require an “Authorization” which is basically an 8 1/2 X 11″ water-marked prescription sheet shown prior to first time admittance inside. The patients keep their authorization and no personal information is collected or kept by the dispensaries. Thanks for the information.

    • David

      I did a search out of curiosity and I couldn’t find any medical dispensaries nor retail rec. stores in Yakima. I spoke to a budtender friend of mine and he was also shocked that you have been paying such a ridiculous price for your medicine. The prices you quote are completely off the chart for Washington medical dispensaries we’re familiar with. Where is this high-priced dispensary located?

  • Green Thumb

    Those are crazy numbers but don’t expect a lot of break in Washington for awhile until they loosen up their regulations some and get more supply …..

    Also correct me if I’m wrong but in Washington you cannot grow your own whereas colorado and oregon you can?

    • David

      At present, recreational adult cannabis grows remain illegal under I- 502. Washington’s medical marijuana patients on the other hand ( of which there are many thousands) can possess and grow up to 15 adult plant’s and 64 ounces of dried flower’s. In Washington, a citizen initiative cannot be changed until two years have passed or a 2/3 majority vote in the legislature occur’s, (after two years a simple majority vote can make any needed changes). The required two years have since passed. When the Washington state Legislative session reconvenes in early 2015, many necessary changes to 502 are expected to be passed and approved, (including recreational grows). It’s anticipated now that changes made to 502 should be completed, prior to Oregon implementing it’s recently passed recreational marijuana law. Thanks.

  • The captain

    Washington prices will drop. It’s just a matter of time. Currently it’s not the state holding up the process, it’s the counties and municipalities. Through zoning and moratoriums, they’re trying to get their mits into some of the tax pie, and who can blame them. Over the next two years you’ll see the bigger grow facilities fire up. If you figure by a good best estimate to grow product indoors your looking at $325 lb to the high side of $500 lb..outdoors or greenhouse less, but that comes with a lot less product making the cut due to molds and fungus…so depending on how a federal excise tax Is split up between the production side and retail side…here’s the breakdown

    $1000 lb ×1.5=$1500 ( this would include 25% state and 25% federal excise taxes

    Retailer makes 50 points or 100% mark up
    $3000×1.5=$4500 ( this includes 25% state and 25% federal excise)

    $4500×1.10=$4950 (this includes sales tax)
    $4950÷448g=$11.05g ( for high quality indoor product)

    Outdoor and greenhouse product will be turned into hashoil…because it will have a difficult time passing microbial testing (without cheating)….and the state will crack down on ma and pa grows….and the feds will send the ATMF in to bust big grows (alcohol tobacco marijuana and firearms) everyone wins including the consumer. Growers will have to grow a lot more to make it work…but aren’t we all just farmers anyway? And by the way if you happen to be a furry hedgehog advertising in the Stranger, grams delivered just contact dumbsh#&$t.com you better know when to say when….times are a changing…NORML is going to need a new cause….The way I see it meth and heroine are next….lol