Marijuana revenue estimate

August 5, 2016 § Leave a comment

How much revenue might governments get from legal marijuana commerce?

In early 2013, I took a stab and said 80 percent of at $30 billion market, or $24 billion.

Now I don’t think we can tax marijuana at the 80 percent level Europe uses for cigarettes. But the market should be bigger than $30 billion.  So I’m rethinking, and working on a more thoughtful estimate of what the market can bear, « Read the rest of this entry »

Ad valorem taxes are flimsy — not just for marijuana

July 25, 2016 § Leave a comment

Primitive marijuana taxes start out “ad valorem,” that is, as a percentage of price. Many of my friends who are non-tax drug policy people gravitate toward these price-based taxes, because prices tend to increase with potency, and roughly with intoxication.  I agree:  Price-based taxes are a good first step in what the RAND report for Vermont calls the “tax-base march of progress.”

But price-based taxes are easy to manipulate. For instance, North Carolina’s new 7.5 percent sales tax on tickets (“admission charges”) is getting eroded by an affiliate of the state, the UNC-Chapel Hill repertory theater. For tickets, or medical devices, there is no analog to the useful weight base for marijuana taxes. But a ticket tax illustrates the flimsiness of taxes based on price, as explained below. « Read the rest of this entry »

UNC erodes NC sales tax

July 25, 2016 § Leave a comment

Price-based taxes are easy to manipulate. For instance, North Carolina’s new 7.5 percent sales tax on tickets (“admission charges”) is getting eroded by an affiliate of the state, the UNC-Chapel Hill repertory theater.

When you order tickets, the theater separately states a ‘Web Handling Fee” that is not taxed. Here’s what an order looks like:

prc « Read the rest of this entry »

Colorado tax rates set high and low records

July 18, 2016 § Leave a comment

Colorado’s nominal tax rate of 15 percent now yields DE FACTO a historically low tax of 60 cents a gram on flowers or bud, and a historically high rate of 17 cents a gram for trim or leaves.   « Read the rest of this entry »

Humboldt OKs 7-acre grow

July 12, 2016 § Leave a comment

When I went to Humboldt County in 2015 to find facts for the California Blue Ribbon Commission, I heard informally that a marijuana grow of 10,000 square feet was enough to make a decent living. So that figure was bandied about as a hard cap – as a way to share the wealth that was about to open up. https://newrevenue.org/2015/08/23/sharing-the-wealth-from-legalization/. Being friends with a lot of Democratic Socialists, I’ve been interested in sharing the wealth, and thinking smaller farms would be an experiment in that direction.

Ten thousand square feet, about a quarter of an acre, was the smallest area I heard, but one acre is the hard cap in Proposition 64, the recreational legalization initiative to be voted on in November, (That acre limit sunsets after a handful of years.)  [UPDATE:  A friend in California indicates that the initiative allows one person to own several grow licenses.  So the only remaining hope for spreading wealth is that regulations will cut back on the ability to have multiple licenses.]

Here’s what the Blue Ribbon Commission said about capping production: « Read the rest of this entry »

St. Pierre steps down

July 8, 2016 § Leave a comment

We came from different directions. Allen St. Pierre, who is stepping down as head of NORML, the cannabis consumer lobby, wanted to legalize marijuana for consumers; I wanted to raise revenue from something whose externalities were less positive than, say, wages paid to workers, which we tax so widely now — while we say America’s most important issue is jobs.

Allen figured that when marijuana got legalized, the public would get a cut. I figured the public would get nothing from cannabis unless the government tolerated it. « Read the rest of this entry »

Carbon tax reading

July 5, 2016 § Leave a comment

Use government cash or tax cuts to subsidize clean energy? No wonder we’re going broke.

With Exxon supporting a carbon tax, the topic is getting serious.  Lots has been written already; here’s a sample from UNC Library.

Carbon tax books photo