Marijuana Hits $1.0 Billion Revenue in U.S. State, Paves the Way for More to Come

Marijuana Revenue Soars

It’s official: the first $1.0 billion has been made by a U.S. state via marijuana taxation. Colorado, the pioneer when it comes to marijuana legalization in the U.S., has now reaped more than $1.0 billion in revenue since it legalized recreational pot in 2014.

The Colorado Department of Revenue announced that the combined marijuana tax, license and fee revenue reached $1.02 billion. Not to mention that marijuana sales alone have exceeded $6.56 billion. (Source: “Colorado has now made more than $1 billion from pot sales” CNN, June 14, 2019.)

“This industry is helping grow our economy by creating jobs and generating valuable revenue that is going towards preventing youth consumption, protecting public health and safety and investing in public school construction,” said Governor Jared Polis. (Source: “Colorado marijuana industry continues to grow, revenue surpasses $1 billion to date,” State of Colorado, June 12, 2019.)

You may be asking yourself: so what? What does this have to do with pot stocks?

The answer is pretty simple: a one followed by nine zeroes is a big number by any measure. Then consider that the state in question, Colorado, isn’t particularly big, and you have a pretty compelling argument for federal legalization of pot in the U.S.: big tax money.

The fact is that the U.S. government is forgoing tens of billions of dollars—and hundreds of billions of tax revenue over the next decade—for every day that it delays what we already know to be certain: that recreational marijuana legalization is inevitable.

While we don’t know when marijuana will find itself on the right side of the law, we do know that that day is approaching, and fast. And when it does, we’re going to see marijuana stocks soar.

I recently covered just how much marijuana stocks in the U.S. have to gain from federal legalization. We’re talking another big-time green rush with many opportunities to profit for savvy investors.

The problem is, as always, getting past the sticklers in Congress who oppose marijuana legalization. Even President Donald Trump has been at best lukewarm on legalization, and at worst he’s hardly been a self-righteous drug crusader.

But with the 2020 election quickly approaching, we may very well see a Congress that is fully controlled by the Democrats as they retake the presidency. Considering most Democratic presidential candidates are pro-pot reform, that means that marijuana could enjoy the fullest support yet from both the judicial and legislative branches.

Even with that control, marijuana legalization will take some wheeling and dealing. Being able to point to literally billions in tax revenue being left on the table, it will be hard for politicians to say no to that prospect.

Not to mention that it also fits in well with a number of other Democratic Party positions (incarceration reduction, equality, social justice, etc.).

Analyst Take

Marijuana revenue only continues to grow across the U.S., and with it, a new windfall for governments from which to draw.

We’re talking money for everything from roads and schools to policing and welfare. Marijuana isn’t going to solve every problem, but it can help provide the funds to tackle a multitude of issues.

At the end of the day, milestones like these only continue to make the obvious case that marijuana legalization in the U.S. needs to happen, and the sooner, the better.