An increasing per-plant or per-square foot fee — as the only marijuana revenue government gets — is still possible in newly legalizing states.
The lack of legal interstate commerce in cannabis in the United States offers opportunities for states to experiment. Some say courts will use the Dormant Commerce Clause to open up interstate commerce without Congressional action. That would bring an end to many state tax experiments. https://newtax.files.wordpress.com/2022/05/federal-shake-up-2022-april-4-tax-notes-oglesby.pdf
With imports and exports illegal, a closed loop jurisdiction is in place. In a closed loop jurisdiction, taxes can be imposed anywhere in the supply chain, from the farm or “grow” to the retail cashier – it doesn’t matter where.
For instance, this method of sharing cannabis wealth and allowing home marijuana grows will work only in a closed loop jurisdiction:
Everyone 21+ can have a grow license.
There are no taxes, and there is only one fee.
Per plant fee:
$1x for the 1st plant
$2x for the 2nd
$4x for the 3rd
$8x for the 4th
$16x for the 5th
& so on.
x=1? 5? 10? . . .
Doubling is easy to understand, but rather than doubling for each plant, the ratio could be smaller: 1.5 instead of 2? 1.2 instead?
And rather than number of plants, the fee could work off grow area, with exponentially increasing rates as grow area expanded.
And we’d need enforced anti-aggregation rules, which the Tax Code has developed well, to prevent people from disguising true ownership.
This kind of fee is realistic only in states that have not legalized commerce yet. Or in nations that won’t allow imports. (Who knows? With narcotics treaties still in place, maybe the United States won’t allow imports after legalization.)
But if you favor wealth sharing and home growing, interstate commerce would kill this kind of revenue plan, as imported products wouldn’t be grown in the state at all. Courts looking at interstate commerce in commerce should understand that it would end all kinds of state experiments, experiments that the federal government should be encouraging, and that federal prohibition indirectly encourages thanks to the existence of closed loop jurisdictions.