SACRAMENTO -
A bill to tax medical marijuana like tobacco is scheduled for hearings by the State Senate Revenue & Taxation Committee next Wednesday, June 23rd.
The bill, SBX6 -16 by Sen. Ronald Calderon of Montebello, would tax all sales of cannabis (except wholesale-level distribution to collectives or cooperatives) at a rate equal to the tobacco products tax rate.
Sen. Calderon's office has been evasive about discussing the bill and has not returned phone calls from medical marijuana proponents.
Patient advocates strongly oppose taxing medical marijuana. "We cannot support taxes on medical marijuana at present inflated black-market prices," stated California NORML in opposition to the
bill. "Many patients are poor and living on disability. Until
current laws are changed to clearly recognize the legality of cannabis sales, any tax proposals are highly premature and unwarranted. "
The provisions of SBX6 16 lack basic understanding of cannabis, which is dissimilar to tobacco both in its health effects and how it
is marketed. Tobacco is taxed by the cigarette, while cannabis is
sold by weight, making it difficult to make sense of the bill's mandate that they be taxed "at the same rate."
Because SBX6 -16 is a tax bill, it requires a 2/3 majority for
passage. Opponents are hopeful that they can defeat the bill in
committee. Medical marijuana supporters are urged to contact the
committee in opposition to SBX6-16.
Committee Chair: Sen. Lois Wolk (D-Davis). Members: Sen. Elaine
Alquist (D-San Jose); Mimi Walters (R-Laguna Niguel); Roy Ashburn (R-Bakersfield); and Alex Padilla (D-Pacoima).
Text of SBX6 -16
http://www.leginfo.ca.gov/cgi-bin/displaycode?section=rtc&group=30001-31000&file=30131-30131.6
Cal NORML letter of opposition:
Sen. Lois Wolk, Chair
Senate Revenue & Taxation Committee
State Capitol
Sacramento CA 95814
Dear Sen. Wolk:
As co-sponsors of Prop. 215, we wish to state our objections to SBX6
16, the proposed "Cannabis Tax Law" (Sen. Calderon).
Until current laws are modified to clarify the legality of
sale of medical cannabis, any such proposal is premature. At
present, the legal status of medical marijuana sales and distribution
remains hazy and disputed. Whereas some localities have recognized
legal sales of medical marijuana through licensed dispensaries, others
have not. Some legal authorities, including the city attorney and D.A.
of Los Angeles, insist that such sales are flatly illegal, and many
distributors continue to experience raids and arrest by local police.
Until this uncertainty is resolved and conditions for legal sale firmly
established in state law, the state lacks clear authority to demand
taxes. In addition, the voters will be considering a "Tax and
Regulate" initiative this November that could substantially change
state laws on marijuana.
We cannot support taxes on medical marijuana at present
inflated black-market prices. Many patients are poor and living on
disability. It is hard to justify a special tax on one kind of
medicine but not on others. SBX6 16 would create a two-tier system, in
which lawful marijuana for medical use would be taxed, but illicit
non-medical marijuana would not. The effect of this would be to
encourage illegal, non-medical production.
SBX6 16 fails to set forth a coherent taxation scheme for cannabis.
The scheme for tobacco taxation set forth in Revenue & Taxation Code
Sections 31001ff does not work for marijuana. Tobacco is taxed by the
cigarette, whereas marijuana is sold by weight.
Logically, any taxation system for marijuana should also be scaled
to the weight content of its major active ingredient, THC. Because
of its minimal production costs, any taxes on marijuana should be
established at a fixed excise rate, not as a percentage of price or
revenues, since the latter could easily plummet by an order of
magnitude in a true legal market. For in-depth analysis, see my paper
on the "Economics of Cannabis Legalization," at http://www.canorml.org/
background/mjeconomics.html.
We urge the committee to reject SBX6 16 as ill-considered and
premature.
Sincerely,
Dale Gieringer
Director, California NORML
--
Dale Gieringer - dale@canorml.org
California NORML, NEW ADDRESS: 2261 Market St. #278A, San Francisco CA 94114 -(415) 563- 5858 - http://www.canorml.org