Voters narrowly approve marijuana taxes setting off possible litigation
Two county ballot measures that increase taxes on marijuana passed by narrow margins on Tuesday night.
The first measure, ballot question 1A, will raise the sales tax on marijuana by 5 percent and the second question, 1B, will raise the excise tax, or a tax on manufacturing marijuana, by 5 percent.
For measure 1A, 3,964 people voted in favor of the measure, while 3,246 voted against. For measure 1B, 3,920 people voted in favor and 3,347 voted against.
Questions had been raised about the accuracy of the revenue numbers cited in the ballot language by the Tabernash dispensary Igadi. Measure 1A said the increased sales tax would raise $310,000 in revenue and Measure 1B said the increased excise tax would generate $155,000 in revenue for the general fund.
David Michel, general counsel for Igadi, said the numbers do not reflect the reality of the industry.
Igadi is the only dispensary in the county that will be affected by the increased excise tax and Michel estimated the most revenue the town could receive from the tax would be around $34,000.
As for the sales tax increase, Michel estimated that Igadi, the largest dispensary in the county, would pay around $109,000 per year and even with revenue from the other two dispensaries, Bonfire and Serene Wellness, he doesn’t believe the revenue would come close to $310,000.
Michel brought his concerns to the Grand County Board of Commissioners, but ballots had already been sent out and ballot language couldn’t be changed. The county also argued that the numbers were an estimate and that there were no legal ramifications for estimating too high or too low of a revenue number in the ballot language.
At the Oct. 23 county commissioners meeting, Michel told the commissioners he was considering legal action if the measures passed.
“We’re in a situation where (the calculations are) misleading and, likely, I believe if we were to challenge it, it would result in it being invalidated,” he told commissioners. “We’re going to challenge this. But, as litigants, we can take an adversarial approach or we can take a collaborative approach.”
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