Nevada Marijuana Tax Revenues Already Reach 110% of Projections

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Legal sales of recreational marijuana in Nevada kicked off on July 1 last year with a projected fiscal year (July through June) tax revenue estimate of $50.32 million. As of the end of April, two months ahead of schedule, the state’s tax receipts from pot sales totaled $55.53 million, 110% of the projected total.

March and April tax receipts reached $7.09 million and $6.55 million, respectively, the two best months for the fiscal year so far. In July 2017 the state collected $3.68 million in tax receipts.

Actual tax receipts have surpassed forecasts in every month of the 2018 fiscal year. At the end of April, tax collections exceed estimates by 30%.

Adult use (recreational) marijuana revenue for the year to date totals $340.57 million. Combined taxable sales of medical marijuana, recreational-use marijuana and marijuana-related tangible goods total $433.51 million through April. Fees, penalties and assessments have contributed another $10.4 million to the state’s coffers.

The state taxes marijuana at the wholesale level and the retail level. For the first 10 months of the fiscal year, the wholesale marijuana tax (15%) has generated $21.47 million, and the retail tax (10%) has brought in $34.06 million.

Wholesale tax receipts are used to fund the costs of administering the Department of Taxation’s marijuana program, $5 million per year is allocated to local governments and the rest goes to the state’s schools. Retail tax receipts are directed to the state’s rainy-day fund.

Utah residents, who will vote in November on making medical marijuana available in the state, are reported to be one reason that sales are above expectations. Mesquite, Nevada, about 340 miles from Salt Lake City, is the closest place for that city’s residents to purchase recreational pot. The city of West Wendover, Nevada, just 90 miles from Salt Lake City, has toyed with the idea of allowing recreational sales, but so far has resisted the temptation. The Mormon church issued a statement in May advocating the initiative’s defeat.