MANITOU SPRINGS, Colo. (KOAA) — Starting Monday, the Manitou Springs special tax on retail marijuana will be lower. Last week, city council voted unanimously to reduce it from 10% to 5%.
The change comes as businesses in Manitou Springs have seen a decrease in revenue since voters approved the sale of recreational marijuana in Colorado Springs.
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The legalization of recreational marijuana sales in Colorado Springs may be taking a toll on a nearby city. The Manitou Springs City Council voted to cut an additional sales tax for recreational marijuana and recreational marijuana products in half.
Recreational sales started in Colorado Springs in April after voters gave the green light not once, but twice, including a special election. There is an additional 5% sales tax on recreational marijuana in Colorado Springs.
The City of Manitou Springs approved an additional 5% sales tax on recreational marijuana in 2013, but the city council increased that to 10% in January of 2022.
There are only two shops in Manitou Springs, Maggie's Farm and Starbuds. The owner and founder of Maggie's Farm, Bill Conkling, tells News5 his business was the single operator that requested Manitou Springs lower taxes.
"The despair in our pricing has already caused a 30% drop in our traffic and our revenue, with more stores still to come in Colorado Springs," Conkling said during a May 20 city council meeting. "It doesn't seem to matter how much we cut our pricing... we Googled and the first thing we see is, 'why go to Manitou when the tax is double?'"
Due to state law, the city can't share specific revenue information on marijuana sales tax because the town has fewer than three stores, so it isn't clear exactly how much the city has benefited over the years from recreational sales.
The marijuana business as a whole has been experiencing a decline in Colorado in recent years.
Conkling sent the following statement to News5 regarding the lowering of the tax:
"[I'm] thankful for our partnership with Manitou and for their response of my ask to lower taxes. Our lowest pricing is about to get lower, so we’re very pleased with the leveling of taxes across the Springs area."
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