How a weight base for marijuana taxes is less arbitrary than the federal liquor tax

April 28, 2015 § Leave a comment

A friend objects to a weight base for taxing marijuana. “Crop quality varies enormously,” he says, “so it would be arbitrary to assess the same tax per weight for all of it.”

OK. Any tax will distort the market. The federal liquor tax is based on proof gallons.  The highest-quality Kentucky Bourbon bears about the same federal liquor tax as the Aristocrat brand – and that finest costs much, much more. (Price reflects quality, or at least perceived quality, you’ve got to figure.)  Our state monopoly liquor store at http://abc.nc.gov/Pricing/PriceList lists one standard sized bottle of the most expensive Bourbon at $249.95 ; Aristocrat is $7.75. That’s a 32 to 1 ratio. But because its proof is 92 versus 80, the expensive stuff bears 1.15  (92/80) times the tax.]

Arbitrary! Guilty as charged. The prices for bud I’ve been looking at online are in the range of a 2 to 1 ratio. Weedmaps, http://www.priceofweed.com, at 8:07 am EDT April 28, 2014, gave these less dramatic numbers: « Read the rest of this entry »

Questionable objections to marijuana monopoly

April 27, 2015 § Leave a comment

Here from vox.com are two objections to marijuana retail monopoly that don’t hold up, in my opinion:

“For states to establish a monopoly on marijuana production and sales, voters or elected officials would have to approve laws that essentially give state governments control over the marijuana industry. Even if a majority of Americans support legalizing marijuana, it’s unclear whether they would support turning their state into a pot dealer — and even if they did, state governments might be reluctant to do this, since it would mean forcing state employees to violate federal law . . . ” That’s from http://www.vox.com/2015/4/27/8500531/marijuana-legalization-commercialization-prohibition.

First, voters in some states might like monopoly: A poll I did among North Carolina voters in 2013 showed a clear preference for state stores (58 percent), our model for liquor, over private stores (19 percent), with 23 percent undecided. https://newtax.files.wordpress.com/2013/03/nc-marijuana-polling-march-2013.pdf, page 2.

Second, in the face of federal law, North Bonneville, Washington, is already selling marijuana via a quasi-monopoly, a Public Authority of the kind described in Chapter 4 of the RAND Report. See  http://www.washingtonpost.com/business/economy/a-local-government-in-wash-state-tries-to-corner-the-market-on-marijuana/2015/03/16/fccb8216-c9b7-11e4-b2a1-bed1aaea2816_story.html.  No arrests yet.

Production monopoly does not seem realistic;  only a retail monopoly, of the kind that 17 states have for liquor, seems plausible.  But I need to find out how Uruguay’s retail monopoly will buy product.

 

Volunteer researcher wanted

April 23, 2015 § Leave a comment

The Center for New Revenue seeks a volunteer researcher.  You can work from anywhere.  The task is to look for lessons for marijuana legalization and taxation. The first assignment is to go through the 686-page Ways & Means Hearings, “Modification of Volstead Act,” December 7 to 14, 1932, which considered how to reinstitute the beer tax after Prohibition ended.  What can those Hearings tell us about how to tax marijuana?  Your report will remain your property; you may decide to grant me a non-exclusive license to publish it on this web site under your name.  You’ll get the benefit, if any, of my suggestions.  Reply with CV, cover note, and questions « Read the rest of this entry »

CO mj tax cut idea

April 22, 2015 § Leave a comment

A Colorado bill, HB 15-1367, would cut its special retail excise tax rate on marijuana from 10 percent to 7 percent. Having come to think that early taxes have proved too high, that makes sense. But what doesn’t make sense to me is the effective date – July 1, 2017. Now is the time the industry needs relief.  Twenty-six months from now, prices may be much lower. A lower rate (7 percent) on a lower base (lower prices due to plenty of supply, etc.) just loses revenue. I would think make the rate 7 percent now, and let it bounce back to 10 percent in mid-2017.  Or at least wait and see.

Two recent bills make sense to me, with increasing rates year by year: Congressman Blumenauer’s bill, and a Massachusetts House bill.

 

Picking Winners: Who Can Grow Marijuana for Sale?

April 20, 2015 § Leave a comment

“Picking Winners: Deciding Who Gets to Grow Marijuana Commercially” – an article I wrote (and waived the right to post) is here, or at http://marijuanalegalization.about.com/od/ModelsofLegalization/fl/Picking-Winners-Deciding-Who-Gets-to-Grow-Marijuana-Commercially.htm.  Comments welcomed.

 

Marijuana and Tobacco Laws — Rachel Barry’s Comparison Chart

April 17, 2015 § 2 Comments

Rachel Barry, a policy scholar at UC-San Francisco’s Center for Tobacco Control Research and Education and my colleague on the California Blue Ribbon Commission on marijuana legalization, has prepared this extensive chart or table comparing marijuana laws and tobacco laws.  To see it easily, click on Rachel Barry MJ policies April 17, 2015; a downloadable Word version is Rachel Barry Word MJ policies April 17, 2015.   I think it’s very useful.  The pasted version below gives you an idea, but you will probably need one of those links to see the whole thing.  (This chart is her work in progress, not that of the Commission.)

She welcomes feedback, and hopes to provide updates as laws change. Please contact her directly with suggestions, corrections, questions, and updates: email:rachel.barry@ucsf.edu,  I’ll try to keep up with her.  (Thanks, Rachel, for letting me post this.) « Read the rest of this entry »

Reasons for a Jet Fuel Tax

April 16, 2015 § Leave a comment

1.  Environmental — marginal pressure on carbon

2.  Progessive — wealthy and corporations are the primary stakeholders.  The housekeepers’ unions at the airline hubs may be the voices for the exception that proves the rule.

3.  I’d even be for a higher gasoline tax, and it’s regressive.  Poor folks drive farther to work than rich folks, who can afford to live in the middle of things.

++++

The jet fuel tax may be low hanging fruit, a sitting duck, underbrush — consensus item.  The kind of thing you put into a bill or package that a majority will sign off on.  Tax Reform, if it follows the 1986 model, would make hundreds of changes to the Tax Code.  Maybe it won’t happen.  But it won’t happen without a list.

 

In progress — comments welcomed.

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