$122 Million In Taxes: Michigan’S Reward For Legalized Marijuana

[bobandtorey]

WallStreetCheatSheet.com, an Internet business news portal, has published a list of the seven states who stand the most to gain financially from the legalization of marijuana, and Michigan is on the list.

Michigan’s potential revenue from sales and excise taxes: $122 million.

Sales and excise taxes go directly to the government and pay for the roads and schools. The total value of Michigan’s marijuana market was projected to be over $580 million in sales to people over the age of 25. If legalized nationally the market for marijuana has been estimated to be $14 billion or more annually.

The list ranked Michigan as 7th in revenue potential behind Ohio, Illinois, Texas, Florida, New York and California- which topped the projected earnings scale at $519.3 million.

How did the number crunchers arrive at their conclusion? NerdWallet explains the methodology in this way:

We used data from the 

Substance Abuse and Mental Health Services Administration

 detailing the percentage of marijuana smokers ages 25 and over in each state and multiplied that percentage by the state’s population older than 25 to get the number of users in each state. We then took the state’s users as a percentage of total users over 25 in the U.S. and multiplied that by the total marijuana market estimate (sized at 

$14 billion

 by Harvard University economist Jeffrey Miron) to determine the market size in each state.

A hypothetical 15% excise tax was included, as were state and local tax numbers.

 

http://www.theweedblog.com/122-million-in-taxes-michigans-reward-for-legalized-marijuana/

Think these numbers are inflated? Guess again. Colorado put nearly $8 million in their state coffers in the month of August alone from taxes on recreational and medical marijuana sales. That’s not total sales of marijuana for the month, it’s actual money paid to the state by consumers.

6th-ranked Ohio’s potential revenue from sales and excise taxes on marijuana sales was less than $1 million larger than Michigan’s, and Illinois came in 5th with $126 million. Although both Illinois and Ohio are more populous and have higher sales taxes, Michigan has a higher percentage of adults who use marijuana, which increased the earnings estimate.

Based on the methodology used, Michigan is projected to currently have 437,649 marijuana consumers over 25 years of age, despite marijuana’s prohibited status. The state medical marijuana program has more than 120,000 registered patients.

Michigan’s entry in the list of seven is included below. Visit the original source material at NerdWallet.com or check out the analysis contained in the nifty top 7 list at Wallstreetcheatsheet.com.

 

Michigan

Population ages 25 and older: 6.62 million

Percent of population 25 and older who have used marijuana in the past month: 6.61%

Number of marijuana users: 437,649

State’s portion of the marijuana market: 4.15%

Marijuana market size: $581.27 million

Tax rate state and local sales taxes combined plus excise tax of 15%: 21%

Potential annual revenue from sales and excise taxes: $122.1 million

Illicit drug use percentage among persons ages 12 and older: 8.68% to 9.35%

Edited October 26, 2014 by bobandtorey

[Indigro]

Shouldnt post these things if u want to keep (ahem) transplants out... ;-).

 

If u just reason based on total populations of each state, gives a rough idea of market potential. CO aint got shiit on MI. But man o man... when Texas goes... just another multibillion Cali.

 

If the gov hurries up & lets Florida, NY, and Texas go free... wow, will be a more effective blow to the cartels than all of the dea & cia & atf efforts combined, over the last 3 decades. Then if they can keep the ownership localized... major boon to small biz owners & the populace as a whole. We really need a bump (the collective we, as in the people). Don't let it go corporate, just as bad as shipping profits to a foreign cartel.

[Habenero]

Will hurt the cartels but screw taxing it. At least not medical. Recreation yeah but they don't tax other medicine so they need to keep their dirty grimy slimy hands outta mine.

[cristinew]

Elect Doug Dern to Michigan Supreme Court and Jim Redford ..NO TO 
Brian Zahra

[solabeirtan]

Just to show what an insignificant number this is: In 2011 MI spent 8 times that amount on tobacco alone. $976 million. Or Cannabis is apx. 13% of tobacco sales. Of the total Sin Tax levied by the SoM in 2011: just under 2.3 Billion, inc Booze, Tobacco and Gambling or  nearly 4% of the entire MI State Revenue in 2011.

 

/s  The State Lottery was approved in 1972. The year of the Watergate break-ins, the beginning of the "War on Drugs", the DEA and seemingly unrelated Iraq Nationalizes its Oil in May 72, (Which had previously been granted [ IPC leases ] prior to  the demise of the Ottomans: circa 1911-12 ) setting the stage for us and our colonial budds for the next 50 years... or more...  

Edited October 28, 2014 by solabeirtan