[An updated version appears as part of http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1741735.]
While marijuana helps some people with illness, I am very wary of exemptions, lower rates, or special rules for marijuana when it’s said to be medicinal. No proscription, no prescription.
First, any special rule puts the government in charge of making decisions about individual people. The government can distinguish, however awkwardly, among substances, so as to tax wine with an alcohol content of 13.9 percent at a lower rate than wine with an alcohol content of 14.0 percent. But putting human beings into categories can be more difficult. To be sure, there are easy cases, like the extra Federal tax exemption for individuals 65 and over (you just produce that birth certificate or otherwise prove your birth date as Mr. Obama has done to the satisfaction of most). But even the extra tax exemption for blindness on the Form 1040 creates a regulatory tangle and even a few disputes. Deciding whether someone has some ailment as subjective as chronic pain is a task that I hate to see government taking on. Folks who are distrustful of government ought to be especially careful about this kind of official categorization of individuals.
Second, any special rule rewards hypocrisy with a special right. Folks who pretend to be sick get something that honest folks won’t allow themselves to get.
Third, providing even any perceived benefit, even a placebo, to folks who say they are sick encourages people to think of themselves as victims. (The argument back is that we all may have chronic pain in our souls: it’s the human condition.) Having people think of themselves as victims has a positive aspect: it encourages them to seek help (and it encourages others to try to get them help). But such thinking tends to weaken the thinker.
Fourth, any special rule adds complexity.
Finally, any special rule diminishes the tax base.
The Center for New Revenue 