The Tax Foundation finds fault with many excise taxes (tobacco, e-cigarettes, sugar, airline services, medical devices, you name it – though, to be fair, the Foundation puts gasoline taxes on the table). So it’s no surprise that it proposes very low federal excise taxes on marijuana. Its federal marijuana tax would be a nickel a gram — compared to the $1.76 per gram tax on the books in Alaska. That is supposed to bring in just $500 million a year nationwide. That looks like chump change.
The Foundation doesn’t mention what happens to the anti-marijuana-advertising rule of Tax Code section 280E, which is bringing in lots of revenue, according to the complaints of retailers. Any modification of 280E would offset other revenue gains. It could wipe out all the revenue from the chump change excise tax.
OK, the Foundation puts forth an alternative federal tax that would raise more — but doesn’t include that higher tax in reaching a $28 billion revenue estimate for marijuana taxes annually, at first. Here are excerpts from the Foundation’s recent report, Continue reading “Chump change from Tax Foundation”