For the first time since marijuana legalization went into effect in January of 2014, monthly sales have topped $100 million. According to just-released figures for the month of August, recreational marijuana accounted for $59.2 million and medicinal marijuana made up $41.4 million of that figure.
Dan Riffle, director of federal policies for the Marijuana Policy Project, told Yahoo News, “It means that $100 million is going to licensed, taxpaying businesses, creating jobs and helping to build new schools, instead of going to cartels and drug dealers — as is the case in the 46 states that don’t regulate marijuana.”
This was the seventh time in eight months that marijuana sales surpassed those of the previous month. In the very first month of legalization, sales totaled $46.9 million, with $14.7 million being recreational and $32.2 million medicinal. Total marijuana sales in Colorado in 2014 reached $700 million, which generated $63 million in tax revenue and $13 million collected in licenses and fees.
There are three separate taxes levied on recreational marijuana sales in Colorado. This includes the customary 2.9 percent sales tax, a 10 percent special marijuana tax, and a 15 percent excise tax on wholesale marijuana transfers, which is earmarked for school construction projects.
Combined with Washington and Oregon, where recreational marijuana has also been legalized, sales are expected to easily pass $1 billion. While budding entrepreneurs aren’t complaining about the high sales figures, it is presenting them with an enormous problem: they are chronically unbankable.
This is because cash proceeds from marijuana sales still violate federal laws, which makes banks dooby-ous (heh) about partnering with marijuana-related businesses. According to the U.S. Treasury Department, only 220 of the nation’s 7,600 banks and credit unions accept cash from businesses in the marijuana industry.
Shhaun Gindi, owner of Colorado’s Compassionate Pain Management, told Bloomberg Business, “I’ve gone through at least eight banks.”
The problem has forced legal, marijuana-related businesses to spend significant amounts of money securing their assets, paying for armed guards, armored vehicles, and sophisticated vaults.
Michael Julian, CEO of marijuana security company MPS International, told Bloomberg, “The federal government and these banking laws are making it so that people have to walk around with tens of thousands of dollars in their businesses, in their cars, in their homes.”
Native American tribes are stepping in to try to fill the void by passing their own laws aimed at offering banking solutions for marijuana businesses, but this is generally not considered to be a viable long-term solution.
Both anecdotal evidence and cold hard numbers have made it clear: after marijuana prohibition’s decades of failure, it is time for federal marijuana regulations to catch up to the times, and become more aligned with the reality evidenced by laws passed in states like Colorado, Oregon, and Washington.