Study: Retail marijuana market revenue a wash for state
The Scott administration and legislative fiscal analysts have reached consensus on how much revenue a legal retail market for marijuana will raise.
A retail market for marijuana in Vermont would bring in new revenue for the state, but officials say nearly all of that money will be needed to cover expenses.
"The uncertainty level with a market that is shifting from an illegal status to a legal status, or one that is shifting from a purely homegrown status to a commercial status, is high. The uncertainty is high, without a doubt," said Andrew Stein, a Tax Department analyst.
Stein says data from states that already have legal markets is helping the state determine how much a market here can generate. "So we can take other states' numbers and adjust them for our population, adjust them for our public health usage rates and gut check our numbers, so that's what we did," Stein said.
The estimates are based on nearly 20 factors run through a simulation model. That analysis shows the first year of a market would raise $6.6 to $12.8-million. By the third year, the range jumps to $13.7 to $26.4-million.
Deputy Tax Commissioner Craig Bolio says that revenue from a 20 percent excise tax and a six percent sales tax will be needed for new health and education programs, new road safety measures and the regulatory infrastructure.
"All of that adds up to about what you see in the estimates. We have been saying all along it does not appear, certainly in the early years, that there would be a major net windfall to the state," Bolio said.
The analysis was done as part of the governor's marijuana advisory commission and will be included in the commission's final report due next month.