Starting in late 2009, I tried to be the world’s expert on marijuana excise tax policy. But now, at 75, I haven’t needed to try for a while. That’s because first-rate tax policy scholars have taken up that work. They cheer me up. Here are writings, roughly in reverse chronological order, showing why I have been easing up.
Richard Auxier of the Tax Policy Center, https://www.taxpolicycenter.org/publications/pros-and-cons-cannabis-taxes (with Nikhita Airi).
Ben Leff of American University Law School, https://www.bu.edu/bulawreview/files/2021/07/LEFF.pdf. Ben is the only law school tax professor who has studied cannabis excise taxes — despite the stigma of the drug and the lack of academic interest in state taxes, excise taxes, and low-revenue taxes. Bravo.
Carl Davis of the Institute on Taxation and Economic Policy, https://itep.org/?s=cannabis#gsc.tab=0&gsc.q=cannabis&gsc.page=1 (Richard Phillips and Misha Hill contributed to some of this work.) Start with https://itep.org/taxing-cannabis/.
Ulrik Boesen, when he was at the Tax Foundation, https://taxfoundation.org/individual-and-consumption-taxes/excise-taxes/marijuana-taxes/. Start with https://taxfoundation.org/recreational-marijuana-tax/.
Jane Gravelle and Sean Lowry from the Congressional Research Service way back in 2014, https://newtax.files.wordpress.com/2015/01/fed-mj-tax-r43785.pdf.
Lots of drug policy scholars (like Kleiman, Humphreys, Caulkins, Kilmer) have looked at cannabis revenue policy too, and plenty of interested industry people do, but my own background in tax leads me to appreciate especially the tax policy specialists who have taken up this work. There’s plenty still to do, and our wide variety of state experiments will help Congress figure out what to do eventually.
A greater need now for me is to follow licensing revenue and whole licensing process, where policymakers are flailing. Nothing works – on the merits, lotteries, social equity – all end with arguable unfairness and time-consuming appeals.
In my state, North Carolina, the State Senate has passed, with negligible debate, a huge medical cannabis bill, SB711, licensing only 10 vertically integrated marijuana sellers, who will be well-heeled investors. We can do better. So watch this space.
But I won’t phase out of marijuana tax policy altogether, because I want to keep harping on the salutary effects of the 280E selling expense tax, which keeps the noise of marijuana commerce down, and hits small word-of-mouth merchants much less than it hits big marketing operations and celebrity endorsers. And I may try to put together a history of cannabis taxes, one that starts with British India in the nineteenth century.
But I’m glad that younger and smarter people are keeping up with hemp drug excise taxes.