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September 16, 2015 was picked because an end-of-year fiscal report is due to be certified the previous day. According to state figures, $700 million worth of legal cannabis was sold in Colorado in 2014. The tax tally was $76 million. Pot taxes were projected to raise $70 million in 2014. They actually raised $58 million, but because overall tax collections exceeded projections, Colorado must ask voters for permission to keep the money. To comply with the requirement that the taxes revert to zero, lawmakers settled on a short one-day tax waiver.

Colorado now has 380 recreational pot dispensaries and 480 licensed recreational pot growers. But even on September 16, Marijuana won’t be completely tax-free. A regular 2.9% sales tax still applies, as do medical marijuana taxes and local pot taxes. For pot retailers, the holiday poses a supply dilemma. They need plenty in stock to sell. But if they stock too much, they’ll forego their own one-day waiver on the 15% excise tax they pay marijuana wholesalers.

Colorado’s Taxpayer’s Bill of Rights—also called TABOR—requires the state to issue refunds to taxpayers if the state’s spending or revenue collections exceed the previous projections. To try to avoid the refund requirement, legislators introduced HB 15-1367, creating a ballot initiative to allow Colorado voters to approve of the state keeping the $58 million in marijuana revenue.

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