The Oregon Office of Economic Analysis has released its forecast for the state’s recreational cannabis revenue, projecting $156 million in cannabis industry taxes over the next two years, according to a Willamette Week report. State economist Josh Lehner’s report indicates that Oregon’s first-year sales closely track Colorado’s first year but “outpaces Washington’s.”
Lehner suggests that Oregon’s strong first year over their northern neighbor is due to four factors: Oregonians simply consume more cannabis than Washington citizens, the state imposes fewer taxes on cannabis products, which leads to Washington residents buying from Oregon shops, and the state has large concentrations of dispensaries in the biggest cities.
Lehner does not anticipate Oregon’s second and third years keeping pace with Colorado.
“On the downside, supply constraints that keep products and inventory low will result in fewer sales, and tax collections,” Lehner writes in the report. “Another downside risk for tax collections are prices, given Oregon levies the tax based on the sales price. To date in Colorado and Washington, prices have fallen around 20 percent per year. Marijuana is a commodity and eventually will be commoditized.”
Lehner also wrote that a federal crackdown on legal cannabis markets is unlikely.
“While there has been no clear warning or action taken,” he writes, “there is a non-zero chance the federal government could step in and eliminate, or severely restrict recreational marijuana sales. In this event, taxes collected would be considerably less than forecasted.”
The next forecast is due out in August, which will include updated figures if the legislature passed any cannabis-related legislation.