Tax proceeds from pot sales of $98M have crushed the $70M initial estimation given to voters.

By Jodie Gummow | February 20, 2014 | Alternet

Colorado’s legal marijuana market has led to higher tax-revenue than was previously expected, according to a budget proposal released by Gov. John Hickenlooper on Wednesday, AP reported.

With retail sales in Colorado remaining strong since beginning on the January 1, the governor has predicted sales and excise taxes next fiscal year would produce $98 million.  This far exceeds the $70 million annual estimate given to and approved by voters last year.

Theproposal which gives the first official estimate of just how much the state expects to make from taxes, outlines plans to spend the funds next fiscal year on substance abuse prevention, youth marijuana use prevention and other priorities.

"This package represents a strong yet cautious first step" for regulating pot, the governor said in his proposal.

The $98 million would include the sale of both recreational pot which is taxed statewide at 12.9 percent and medical marijuana taxed at 2.9 percent.  Total pot sales in Colorado for next fiscal year were estimated at approximately $610 million.

Meanwhile, Washington has also released a predicted budget forecast even though sales don’t begin in the state for a few more months.  

No doubt other states considering the legalization of recreational marijuana will be watching the Colorado model closely to see just how much tax revenue can be generated, with the latest figures indicating a high prospect of significant monetary return.