State marijuana taxes today

chart in word 18 October 2017This chart reflects my understanding as of 18 October 2017, and reflects recent changes in CO, MA, NV, and WA.  Comments and corrections welcomed. Continue reading “State marijuana taxes today”

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Full Repatriation Now

Why we have a right to tax deferred off-shore income, beyond allowing shareholders the limited liability of a U.S. corporation, by Steve Shay, building on the analysis of my hero, Charles I. Kingson, in The Great American Jobs Act Caper, http://heinonline.org/HOL/LandingPage?handle=hein.journals/taxlr58&div=17&id=&page= (paywall).

“The primary businesses of [the 10 biggest beneficiaries of the repatriation tax amnesty windfall] rest on one or more of: (i) technology patents, copyrights, and trademarks created under the protection of U.S. laws; (ii) U.S. food and drug approvals authorizing access to and assurance to U.S. healthcare consumers; (iii) the internet developed by the U.S. government and transitioned to private hands; or (iv) leases of valuable rights to U.S. oil and gas natural resources. All of these are fruits of U.S. public goods and legal infrastructure developed and maintained with U.S. taxpayer dollars. Yet, these companies have been permitted to routinely use transfer pricing and stateless income planning techniques to pay extraordinarily low rates of tax on vast swathes of their income—and now the plan is to give them an amnesty rate on pre-effective date earnings?”

https://www.finance.senate.gov/imo/media/doc/Shay%2010-3-17%20SFC%20Testimony%20final%209-30.pdf

 

Inaccurate info about cannabis taxes

I’ve consistently said marijuana taxes can be too high at first. Fitch Ratings warns of that too, but supports its warning with this inaccurate statement: “Colorado, Washington and Oregon each lowered their cannabis taxes following legalization to address black market competition.”  https://www.fitchratings.com/site/pr/1029632. But it would be nice to get the facts straight.

Fitch apparently relies on material published April 20, 2016 (4/20 – get it?) by the Tax Foundation, which alleged, “Colorado, Washington, and Oregon have all taken steps to reduce their marijuana tax rates.” That was questionable too, even at the time, but there’s another problem: “lowered” is not the same as “taken steps to lower.”

Let’s start with Colorado. Continue reading “Inaccurate info about cannabis taxes”

Border Tax Adjustments for Carbon Taxes — The ODC Model

The killer problem for carbon taxes is that they favor foreign manufacturers, and we want manufacturing jobs. Any carbon tax will provoke calls for border adjustment taxes – or border tax adjustments (BTAs). The difficulty in imposing BTAs is great. Professor Peter Barnes of Duke has guided my thinking on the issues involved, and some of this comes directly from him.  But this is my primitive thinking, for which he is not to blame.

How can we distinguish between imported goods that were manufactured using coal-generated electricity and goods manufactured using solar energy?  To create the right incentives, we should make that distinction.  But administering the distinction is impossible.    Continue reading “Border Tax Adjustments for Carbon Taxes — The ODC Model”

Mechanics of stated THC tax on marijuana

A cannabis flower tax could be imposed as the greater of a weight tax or a stated THC tax (using the THC figure the seller claims on packaging or in selling). The tax could be the greater of (1) $x per gram of product weight or (2) $Y per gram of stated THC weight.

Here are very rough notes on how such a tax might work (supplemented by comments from my friend Jon Caulkins at the end).

Example 1: Continue reading “Mechanics of stated THC tax on marijuana”

Why minimum unit pricing for cannabis leaves me cold

Minimum unit pricing – charging a minimum price for temptation goods – appeals to some students of cannabis legalization.

To me, government monopoly or high taxes can work better to serve policy goals. I’m just starting to think about this, and looking for pushback.

  1. The successes claimed for minimum unit pricing often involve loss leaders – where temptation goods are sold at a low price so as to bring customers in to buy goods that produce more profit for the seller. To the extent that cannabis commerce is isolated, that problem goes away. Most cannabis retailers in the United States sell little other than cannabis. They may sell pipes, papers, and T-shirts, but none sell alcohol. I don’t know of any that sell food (other than cannabis-infused food) or household goods. So any price-cutting that cannabis sellers do today goes pretty much straight to the bottom line. Sellers are hardly making up for the loss by selling non-cannabis products..  A well-regulated cannabis market lets cannabis seller sell nothing or almost nothing but cannabis, I think.

Continue reading “Why minimum unit pricing for cannabis leaves me cold”

Panel for NORML: “Legalization as an Economic Stimulus for All”

UPDATE:  Just tweeted (5 November 2017) that Oakland’s set-aside project is slowing legalization to a halt.  This link is illustrative:  “New hitch in Oakland pot permit pipeline.”

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The NORML Conference in DC on September 11 has me on a panel that with the proposed title, “Legalization as an Economic Stimulus for All.” And we may get into this question: “How is it that we can create a market that is inclusive to those who have been most disproportionately affected by prohibition?”  http://norml.org/conference

My take is: Let the government own the means of production, and hire people who were disproportionately affected. The government monopoly model is happening in North Bonneville, Washington, and in the State of Louisiana. Or take tax revenue to help those folks, or, in a less targeted way suggested by Arwa Mahdawi, to help African-Americans who have suffered especially from the War on Drugs. Continue reading “Panel for NORML: “Legalization as an Economic Stimulus for All””