cannabisnews.com: Illegal-Drug Tax Buds Into Profit





Illegal-Drug Tax Buds Into Profit
Posted by CN Staff on January 26, 2003 at 21:27:39 PT
By Dion Lefler, The Wichita Eagle
Source: Wichita Eagle 
Here's a rare bright spot in the state budget: Income from taxes on marijuana, cocaine and other illegal drugs is up this year. Say what?Believe it or not, state tax collections on marijuana increased by 3.6 percent, from $139,227 to $144, 236, in the first half of this fiscal year. And tax collections on cocaine, methamphetamine and other hard drugs are up a whopping 20.6 percent, from $252,515 to $304,905.
Perhaps an explanation is in order.The state taxes marijuana and cocaine just as it does such legal products as alcohol and cigarettes.It even issues a gold foil "drug tax stamp," showing a marijuana leaf, a vial of cocaine and three pills. The stamps come in handy denominations from $10 to $1,000.Illegal drugs have their own tax table. For example, there are three different rates for marijuana: "wet plant," "dry plant" and "processed."Under the relevant state law, "the drug tax is due as soon as the dealer takes possession of the marijuana or controlled substance," according to the state Department of Revenue's Web site.Dealers are supposed to "attach the stamp to the marijuana and/or controlled substance immediately after receiving the substance."Although it sounds pretty goofy, the drug tax actually makes sense on several fronts, officials said.For one thing, it allows the state to seek civil penalties from dealers regardless of the outcome of any criminal prosecution, said Bob Longino, director of the Division of Alcohol Beverage Control, the branch of the Revenue Department that administers the program.And while federal law allows the seizure of assets used in the drug trade, the state tax law throws a broader dragnet. The state can seize any property owned by the drug dealer -- whether it's used in the drug trade or not -- to satisfy an outstanding tax obligation, Longino said.No one seriously suggests that drug pushers, who by definition are breaking the law, are buying tax stamps."Just about the only people who buy those are stamp collectors," said Sen. Stan Clark, R-Oakley, a member of the Assessment and Taxation Committee."My son and I collect stamps, but we didn't want that kind of public exposure," he laughed.He needn't have worried too much.The Revenue Department is well aware of the collector interest in its stamps, Longino said. "That's about all we sell."In fact, the department's Web site even has a "frequently asked questions" page about the drug tax stamps.One of the questions is "Can I purchase drug tax stamps through the mail?"The answer is "Yes." But, "the purchaser will need to provide their mailing address in order for the department to send drug tax stamps."You might think it would take a pretty dim-witted drug dealer to fall for that.But the Revenue Department assures that drug stamp purchases are anonymous -- and information is not shared with law enforcement -- to protect the stamp buyers' constitutional right not to incriminate themselves in a crime.Because the tax usually is collected only after a drug dealer is arrested, 75 percent of the money goes to the local law enforcement agency while 25 percent goes to the state general fund.Last year, Sedgwick County got $54,000 in drug-tax proceeds, finance department records show.In the last session of the Legislature, lawmakers working to close a $700 million-plus budget gap voted to raise the tax on cigarettes by 55 cents a pack -- but left the marijuana and drug tax rates untouched.How fair is that?Not very, several lawmakers said."I guess maybe nobody thought about it," said House Majority Leader Clay Aurand, R-Courtland. His guess was that legislators were busy looking for big money and overlooked small-ticket items like the drug tax.Yet, it's probably the one tax increase even the most anti-tax legislator could love."The standard argument is that if you raise taxes too much, people won't buy the product," Aurand said. Which, he pointed out, is kind of the point of having drug laws in the first place."There's no reason not to double it," he said.Source: Wichita Eagle (KS)Author: Dion Lefler, The Wichita EaglePublished: Sunday, January 26, 2003Copyright: 2002 The Wichita EagleContact: weedit wichitaeagle.comWebsite: http://www.wichitaeagle.com/CannabisNews - Cannabis Archiveshttp://cannabisnews.com/news/list/cannabis.shtml
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Comment #3 posted by mobilewalt on June 12, 2003 at 22:54:14 PT:
tax stamps
Do some research and you will find that just about every state has tax stamps. There was even a case in Nebraska (which I have yet to find) where the defendant lost in the lower court, but won in the supreme court BECAUSE HE BOUGHT THE TAX STAMPS and AFFIXED THEM to his stash!The Nebraska Supreme court held that the state could not have it both ways. It could not charge him the tax, and then steal (confiscate) that which was rightfully his (he purchased and even got the stamps for) AND fine him for it.That would be like a child asking for a slingshot. The parent makes the child work (pay) for the slingshot. Once the child receives it, the parent then takes it back and grounds the child for having a slingshot. That's justice?There used to be federal tax stamps (were purchased at the post office) for controlled substances until 1971, I think (a case in 1970 may have caused it to be repealed when the argument of double jeapordy came up) (see 396 U.S. 398, 90 S. Ct. 642, 24 L. Ed. 2d 610).
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Comment #2 posted by Whirrlin on January 27, 2003 at 07:21:34 PT:
Taxation without Legalization!
Interesting! It's looks like at least one state, has firgured out how to gather taxes from illegal drugs without legalization! Why should they legalize Marijuana (in this state) they would rather have the black market,it's a money maker. I wonder how much money would be collected if full legalization, were to occur? More or Less? Think about it!
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Comment #1 posted by FoM on January 26, 2003 at 21:58:32 PT
Bird-Feed Shop Selling Marijuana
Source: Taipei TimesPublished: Sunday, Jan 26, 2003, Page 4 Copyright: 1999-2003 The Taipei TimesThe owner of a bird-feed shop in southern Taiwan was arrested for selling marijuana seeds in the guise of pigeon feed, the Coast Guard Administration said yesterday.Administration law enforcement agents raided a feed shop in Luchu, Kaohsiung County Friday afternoon and arrested the owner, Chuang Yung-sen, 49, and seized 39.8kg of marijuana seeds.Police said that the seizure was the largest in years. The seeds, if germinated, could yield a profit of about NT$4 billion (US$116 million), they added.According to law, marijuana seeds can be used as bird feed as long as they are first heated to render them incapable of germinating. The interior of the seeds are sometimes used in Chinese medicine or food additives. Taiwan currently allows the import of such seeds if they are verified as having been baked in the same location where they were harvested.Complete Article: http://www.taipeitimes.com/News/taiwan/archives/2003/01/26/192467
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