You are here
Home > News > Denver Auditor Suggests 3.5 Percent Tax

Denver Auditor Suggests 3.5 Percent Tax

Denver Auditor Dennis Gallagher disagrees with Mayor Michael Hancock’s recreational marijuana tax target, arguing the city should seek a starting tax rate of 3.5 percent instead of the mayor’s suggested 5 percent tax rate.

Gallagher warned Denver City Council members in a letter sent to Councilman Charlie Brown Monday, that the city’s 5 percent tax rate plan risks sending users back to the “dark shadows of the black market.”

“He wants the city to be very careful about not putting too much of a tax on it, because you (could) then defeat the purpose of what Amendment 64 was meant to do, which is not buying on the black market,” said Denis Berckefeldt, spokesman for the auditor.

The city expects it will have to spend about $9.4 million on education, enforcement and regulation of the pot industry, for which the tax would compensate.

The council will determine a starting tax rate and ceiling at its meeting Monday. The city will then pose those rates to voters in November. If approved, the council can raise the recreational marijuana tax rate to the determined cap.

Councilwoman Jeanne Faatz said she is concerned with providing Denver with the necessary resources to regulate this new industry.

“I see no reason to start worrying about competing with the black market,” she said. “I want to set (the tax) where I feel makes sense, and I don’t believe that 5 percent is excessive.”

The letter came less than a week after an audit found grievous problems with how the city licenses, tracks and manages Denver’s medical marijuana industry.


Complete Article:

Source: Denver Post (CO)
Author: Ally Marotti, The Denver Post
Published: July 24, 2013
Copyright: 2013 The Denver Post

Leave a Reply