After Year Of Washington Legal Pot Sales, Taxes Top $70m

Washington pot farmers, processors and retailers have complained all year that heavy state and federal tax burdens, along with competition from an unregulated medical marijuana market, have made it difficult for them to do business. Despite some industry gripes and those tweaks to Washington's legal pot law, which voters passed in 2012 to legalize marijuana for adults over 21, officials and legalization backers say the state's slow and deliberate effort to regulate marijuana has been a success. "Nobody's counting on the revenue from cannabis sales to save us, but it has an impact," David Zuckerman, a Vermont state senator and legalization advocate, said during a recent visit to Seattle. James Lathrop, who owns Seattle's first legal marijuana shop, Cannabis City, says through the end of 2014, his estimated federal tax liability was $510,000, on top of the $778,000 he owed the state on $3.1 million in sales. With few growers harvesting by the time the first stores opened, the average price of a gram of legal marijuana spiked to nearly $30 last summer — about three times the cost in medical marijuana shops. [...] Washington has harvested 13.5 tons of marijuana flower intended to be sold as bud, but stores have only sold about 10 tons. Rick Garza, director of Washington's Liquor Control Board — soon to be renamed the Liquor and Cannabis Board — says he's most proud of Washington's efforts at meeting the top priorities the Justice Department laid out when it announced it would allow Washington, Colorado and other states to regulate marijuana: keeping criminal organizations out of the industry, keeping the marijuana in-state and keeping pot away from kids. The state adopted background checks and financial investigations of pot-license applicants, and capped the total amount of production to try to keep it in line with in-state demand. While public health advocates say they wished the state had done more to stress the potential harms of pot to teens, the state required strict packaging and labeling requirements to keep children from getting into the weed.

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