Marijuana Tax Revenue May Not Meet Expectations
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Marijuana Tax Revenue May Not Meet Expectations
Posted by CN Staff on March 06, 2014 at 05:31:25 PT
Washington Post Editorial
Source: Washington Post
USA -- Marijuana legalization was a hot topic at the recent meeting of the National Governors Association in Washington, for obvious reasons — among them the prospect of raising much-needed revenue by taxing pot sales. “With all the bad weather we’ve had back home and all the potholes, we ought to have the revenue go to infrastructure — ‘pot for potholes,’ ” Rhode Island Gov. Lincoln Chafee (I) said.Such an experiment is underway in Washington and Colorado, so it’s noteworthy that John Hickenlooper, the latter state’s Democratic governor, did not echo Mr. Chafee’s enthusiasm about the tax bonanza. “Going out and getting tax revenue is absolutely the wrong reason to even think about legalizing recreational marijuana,” he said, since it puts a state in the position of benefiting from use of a harmful substance — even if it’s not the most harmful.
Of course, government is already in that position, due to the levying of “sin taxes” on tobacco and alcohol. Mr. Hickenlooper could have bolstered his moral argument with a more practical political one: Over time, the tax take from legal pot probably won’t live up to the hype because producers, distributors and consumers could develop into a powerful lobby opposed to taxation. That’s the lesson of post-Prohibition federal excise taxes on alcoholic beverages, which have gone up just once for beer and wine and twice for distilled spirits over the past 60 years. As a result, excise tax rates on alcohol are “far lower than historical levels when adjusted for inflation,” as the nonpartisan Congressional Budget Office puts it in a recent report. The erosion of alcohol taxes is a tribute to the alcoholic beverage industry’s clout on Capitol Hill. And U.S. breweries are pushing a bill that would erode them further, by halving the $18-per-barrel excise tax that large brewers pay and lessening the more modest tax on microbreweries. The proposal has 91 co-sponsors in the House, according to a recent National Journal account. The beer lobby says it’s all about helping the industry create jobs.The bill’s prospects for passage are dim in the short run, which is good, since what the country needs is a higher alcohol excise tax to help restore its lost value, trim the deficit and account more fully for the public health and safety costs of alcohol abuse. Also, the tax should be applied more uniformly across all beverages, as opposed to varying rates for liquor, beer and wine. The CBO says that taxing them all at $16 per proof gallon, a standard measure of alcohol content, would raise $64 billion over 10 years. Our position is that marijuana should be decriminalized, but states in our area should go slow on any broader legalization until the results of the Washington and Colorado experiments are in. Obviously, some tax revenue from pot sales is better than none, which is what we get now. However, the likelihood of a smaller-than-advertised tax windfall is one of the many unintended consequences of legalization that lawmakers must weigh before they act.Editorials represent the views of The Washington Post as an institution, as determined through debate among members of the editorial board. News reporters and editors never contribute to editorial board discussions, and editorial board members don’t have any role in news coverage.Source: Washington Post (DC) Published: March 5, 2014Copyright: 2014 Washington Post CompanyContact: letters Website: URL:  -- Cannabis Archives 
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Comment #4 posted by The GCW on March 06, 2014 at 13:25:50 PT
Hickenlooper is correct.
US NH: PUB LTE: Why To Legalize PotSource: Concord Monitor (NH)Re "Governors: Legalized pot buzz just smoke" ( Monitor Nation & World section, Feb. 23 ): Colorado Gov. John Hickenlooper is correct: Tax revenue is the wrong reason for legalizing recreational marijuana. Legalize the plant for the correct reasons: While illegal, it causes underground markets, cartels, increased hard drug addiction rates, contempt for drug laws, eroded constitutional rights, loss of freedom, escalated prison populations, corrupt politicians, race discrimination, prohibition of free American farmers from growing hemp ( even though communist Chinese farmers grow it ), trillions of dollars in wasted taxes, deceiving citizens and the listing is growing faster than the plant itself. Just be sure to get the job done.
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Comment #3 posted by afterburner on March 06, 2014 at 10:42:39 PT
So, U.S. Federal Government Is Alcohol Pusher
"That's the lesson of post-Prohibition federal excise taxes on alcoholic beverages, which have gone up just once for beer and wine and twice for distilled spirits over the past 60 years. As a result, excise tax rates on alcohol are 'far lower than historical levels when adjusted for inflation,' as the nonpartisan Congressional Budget Office puts it in a recent report."Cannabis, safer!Cannabis, safer!
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Comment #2 posted by runruff on March 06, 2014 at 06:07:43 PT
Harmful substance?
reminds of the old joke; "My doctor said it will kill me but he didn't say when!"I have been using cannabis much more on than off since I was 17, 50 years ago and of all my piers I am the most youthful, healthy and energetic among them.I cut and split by hand my own firewood. Every year I put in three gardens. One big Veggie garden and two pot gardens.I help my Dear Wife with her pet rescue projects which can be a full time job, the way she does it.I like to spend time restoring my Silver bullet, I call it. It is a 1985 Rx7 GSL/SE. I love this car!We take short trips together all the time.I spend week-ends on the road during the summer tending book sales events and other venues in that vein.If nothing else is going on I spend as much time as I can working on one of my three books I have in the hopper.There really is much more going on in my life, to much catagoize here but you get the picture? I am a living anecdote. I am everything contrary to what these fossil brained morons are saying about the herb. I am living proof that they are trying to maintain that the world is flat!One more thing; I have glaecoma and would have been legally blind years ago. As it is I have wonderful eyesight. I can see the eye of an eagle looking back at me! HA! 
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Comment #1 posted by FoM on March 06, 2014 at 05:35:34 PT
Just a Comment
In any business supply and demand will bring prices down for consumers. As long as all states don't legalize tourism will stay up and prices high for the wise states that legalize. Governor Hickenlooper is a business man and he knows that.
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