Bud-Trim Line

“It would be impractical to try to establish legally enforceable standards of how well trimmed a bud can be before it is no longer legally a bud.” That’s from After Legalization, by Jon Walker of Firedog Lake. Phil Smith calls the book “in-depth, thoughtful, and insightful.”

Here are the stakes: In states that draw a tax line around “buds” or “flowers,” the taxpayer wants to categorize plant matter as lightly taxed “trim” rather than heavily taxed bud. That lightly taxed trim can then go into concentrates, sold for edibles, vaporization, tinctures, and so on.  Taxpayers may be able to report THC potency of those trim-based products, despite the inaccuracy of potency testing, so long as the reports aren’t fraudulent or deliberately misleading.

In Colorado, the tax on bud is 62 cents a gram; on trim, it’s 10 cents. Other states are interested in using that distinction: the leading bill in Rhode Island would tax bud five times more than trim ($1.76 per gram versus $.35); Alaska’s likely-to-pass initiative says the state “may establish a rate lower than $50 per ounce [($1.76 per gram] for certain parts of the marijuana plant.”

A longer quote from the book is here:

“The issue with a per-ounce tax is that it creates too many practical problems. There are too many ways to game this system, and with a large tax, plenty of incentive to try. Someone could remove only the trichomes from the buds to create very potent kief. This higher THC-per-ounce product would be a way to avoid most of the tax. It would be impractical to try to establish legally enforceable standards of how well trimmed a bud can be before it is no longer legally a bud.” Page 66, Kindle version, footnote omitted.

Looking for reaction, especially, but not only, from Colorado.

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Author: patoglesby

From 1982 to 1990, I worked in tax policy for Committees of the United States Congress. In recent years, I was Adjunct Lecturer at UNC-Chapel Hill's Business School and then Adjunct Professor at its Law School.

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