Voters in Three Colorado Towns Decide on New Weed Tax Rules

Residents in three small Colorado communities voted Tuesday to change how local marijuana sales are taxed. The measures had mixed results, with one town approving a rule that will actually reduce its annual income from dispensaries.

In Niwot, an unincorporated community between Boulder and Longmont, voters rejected Ballot Issue 304. The measure would have added a 3% special tax on recreational marijuana sales. Boulder County clerk data from early Wednesday shows more than 62% of voters opposed the tax. If passed, the fee would have generated an estimated $60,000 per year for the town. One dispensary, Star Buds, currently operates in Niwot.

Paonia in Delta County took a different path. Voters approved Ballot Issue 2A by more than 70%, according to Delta County election results. The town currently charges a flat $5 fee on every dispensary purchase. The new rule replaces that fee with a 5% local sales tax on those purchases. This change is projected to decrease annual revenue by $40,000. Two dispensaries, Jimmy’s Joint and Valley High, serve the town of fewer than 2,000 residents.

In De Beque, Mesa County voters turned down Ballot Issue 2C. The proposal sought to impose a $5 fee on each wholesale pound of medical marijuana and related products sold or transferred by dispensaries. Mesa County Clerk’s office records indicate almost 69% of voters rejected the measure. The new fee would have raised an estimated $40,000 annually. State records show two dispensaries and two growing operations are located in De Beque.

Colorado dispensaries reported $1.3 billion in statewide sales last year. While the plant remains a major economic driver, local towns have varying approaches to taxing the industry. Some municipalities add local sales taxes, while others use flat fees or leave the state tax structure intact without additional local levies.

Niwot voters also rejected measures to incorporate the town as a registered municipality. They turned down questions regarding home rule and a charter commission. De Beque and Paonia focused solely on their specific marijuana tax structures in this election cycle.