This amendment adds money to the bill so the state can pay for staff and computer systems needed to manage marijuana taxes.
Colorado2026Enacted
HB26-1077
HB26-1077: Tax Rates for Indoor and Outdoor Marijuana
Last scannedAug 24, 2026, 8:22 AM
In one sentence
This law updates how the state calculates tax rates on unprocessed marijuana by creating separate categories based on whether plants are grown indoors or outdoors, including specific rules for fresh-frozen products.
What it does
- Defines 'outdoor' marijuana as plants cultivated under natural sunlight and weather without artificial light or structures, with limited exceptions.
- Defines 'indoor' marijuana as any plant not meeting the definition of outdoor growth.
- Requires separate tax rates for fresh-frozen indoor unprocessed retail marijuana and fresh-frozen outdoor unprocessed retail marijuana.
- Maintains a requirement that marijuana used to make extracts has a lower average market rate than plants sold directly to consumers.
- Orders the Department of Revenue to create rules setting these new rates by July 1, 2027.
- Requires the Department of Revenue to publish how they calculate each tax rate and what data sources they use.
Who it affects
- The Colorado Department of Revenue
- Retail marijuana cultivation facilities
- Manufacturers and stores that buy unprocessed retail marijuana
Limits and unknowns
- The specific tax rates for the new categories will be set by rules adopted later.
- The exact effective date of these changes is not listed in the provided text.
Plain language
Terms to know
- Average market rate
- The average price used to calculate the tax on the first sale of unprocessed marijuana.
- Unprocessed retail marijuana
- Marijuana plants that have not been turned into other products like oils or edibles yet.
Official record
Sources
Official summary
Current law imposes a tax on the first sale or transfer of unprocessed retail marijuana at a rate of 15% of the average market rate of the unprocessed retail marijuana. The 'average market rate' is currently defined as the average price, as determined by the department of revenue (department), of all unprocessed retail marijuana that is sold or transferred from retail marijuana cultivation facilities in the state to retail marijuana product manufacturing facilities or retail marijuana stores. The act specifies that 'outdoor unprocessed retail marijuana' is cultivated under natural sunlight and weather conditions without artificial light or structures, except under limited specified circumstances, and 'indoor unprocessed retail marijuana' is cultivated in any manner other than 'outdoor unprocessed retail marijuana.' The act also amends the existing definition of 'average market rate' to require separate rates for fresh frozen indoor unprocessed retail marijuana and fresh frozen outdoor unprocessed retail marijuana. The act requires the department to adopt rules to establish the rates for fresh frozen indoor unprocessed retail marijuana and fresh frozen outdoor unprocessed retail marijuana on or before July 1, 2027. In addition, the existing definition of 'average market rate' requires that unprocessed retail marijuana for extractions have a separate average market rate that is lower than the rate for unprocessed retail marijuana for direct sale to consumers. The act maintains this requirement. The act also requires the department to publish a general description of the methodology and data sources used to establish the rate for each average market rate category of unprocessed retail marijuana. (Note: This summary applies to this bill as enacted.)
Official activity
Bill history
- Governor SignedGovernor
- Sent to the GovernorGovernor
- Signed by the President of the SenateSenate
- Signed by the Speaker of the HouseHouse
- House Considered Senate Amendments - Result was to Concur - RepassHouse
- Senate Third Reading Passed with Amendments - FloorSenate
- Senate Second Reading Special Order - Passed with Amendments - CommitteeSenate
- Senate Committee on Finance Refer Amended to Senate Committee of the WholeSenate
- Introduced In Senate - Assigned to FinanceSenate
- House Third Reading Passed - No AmendmentsHouse
- House Second Reading Special Order - Passed with Amendments - CommitteeHouse
- House Committee on Appropriations Refer Amended to House Committee of the WholeHouse
- House Committee on Finance Refer Unamended to AppropriationsHouse
- Introduced In House - Assigned to FinanceHouse
Changes
Amendments
5 stored
This amendment requires the state department to publish a general explanation of how it calculates tax rates for unprocessed retail marijuana.
This amendment adds a new definition for 'outdoor unprocessed retail marijuana' to the state tax law.
This amendment changes how the tax rate for marijuana is calculated by requiring lower rates for plants used to make extracts and setting a deadline for new rules on fresh frozen products.
This amendment changes a specific number in the bill from 6.5 to 6.7, removes several lines of text on page 4, and updates the title word.