Denver’s proposed marijuana tax less than Richmond meal’s tax

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DENVER — The Denver City Council finally settled on a proposed tax rate for recreational marijuana sales.

These so-called pot shops will open their doors for business in January.

We found it interesting that the tax for recreational marijuana sales will be less than the meals tax in Richmond (6 percent) and Virginia Beach (5.5 percent). For a decent look at meals taxes around the nation, click here. This isn’t a story against the meals tax, per say, it’s a story of a U.S. state trying to figure out how to tax marijuana.

City leaders decided on a rate of 3.5 percent. But the ultimate decision will come from the voters in the November election. Some want a higher tax.

Others say a higher tax would force business owners to raise prices and could create demand for pot on the black market.

Diane Carlson, a member of the citizen’s group SMART, approves of a measure in the bill that would allow the city council to increase the tax rate to 15-percent without input from voters. She wants a higher tax on marijuana.

Others, like Luke Ramirez who hopes to run one of the first recreational marijuana shops, fear that a tax too high would create a higher black market demand because he would have to increase prices.

Denver city councilwoman Robin Kneich doesn’t share that concern.

She is hoping that the marijuana businesses boom and tax revenue can be used to address major problems like homelessness.

“If you actually look at the pricing on this product, these are less than a dollar difference in the amounts that most people will be buying this product at,” she said.

“If it does well after six months or a year we should look at it as a potential source, to make sure that this city continues to be a place where people of all incomes should live,” said Kneich.

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