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**Pompo** · 03-30-2008, 06:20 PM

Medicinal marijuana puts tax collectors in tight spot
3/27/08|Capitol Weekly| by John Howard

In a tight budget year, California wants every tax dollar it can lay its hands on. This year, those hands are reaching for marijuana.

More than a decade ago, California voters approved the use of marijuana for medical purposes, making it legal under state law. However, federal law enforcers say marijuana use of any kind is illegal - and they are raiding clinics to prove their point. The state tax appeals board, which wants the sales taxes, is stuck in the middle.

"We're caught between a rock and a hard place," said Betty Yee, a member of the state Board of Equalization, which collects and distributes sales taxes on more than $553 billion worth of transactions each year in California on everything from corkscrews to Cadillacs. "We do not want to serve as aiding or abetting the (federal Drug Enforcement Administration). But they (the dispensaries) are not exempt from the sales tax, so by law we have to enforce it," Yee said.

Yee's district encompasses all of coastal California from Santa Barbara to the Oregon state line and includes scores of marijuana dispensaries and thousands of medicinal users.

Estimates vary wildly on just how much taxable marijuana is out there. The state, facing $16 billion in red ink through the middle of next year, wants precise numbers. So far, it doesn't have them. State authorities are quick to point out that collecting marijuana taxes won't balance California's books - but every penny helps.

The Board of Equalization says it collected about $11.4 million in tax on some $142 million worth of medicinal marijuana sales in 2005-06, the most recent period for which numbers are available. That's likely a partial amount, because the board's taxation policy was adopted in October 2005, the final rule didn't go into effect until 15 months later, and it typically takes time to ramp up tax programs.

About 200,000 people across California are authorized by their doctors to use marijuana for medical reasons. The drug costs about $40 for an eighth of an ounce.

The sales of medicinal marijuana are tiny compared with other products, such as $20 billion in apparel sales and nearly $18 billion for office and school supplies. Even the smallest category - fuel and ice sales - among some four dozen listed by the tax board totals more than $414 million, nearly three times the level of the medicinal marijuana transactions. Marijuana vendors are listed as selling "general merchandise" - an attempt to give some anonymity to sellers who fear federal intervention.

Americans for Safe Access, a pro-medicinal marijuana group that favors similar programs nationwide, says the state's figures are deceptive. The group surveyed a representative sampling of California dispensaries and tallied their sales, then multiplied that amount by the number of dispensaries in the state. ASA estimated the paid sales tax at about $100 million, and the amount of taxable sales at about $800 million. "This is a significant amount of money in a tough budget year," said ASA spokesman Kris Hermes. "We'd rather have the Board of Equalization be the entity that gives out that number, but they say it goes directly into the General Fund and there is nothing that requires the dispensaries to indicate what they sell. I hope over time that they will consider it, so it's not just us saying that we represent $100 million annually in sales taxes," Hermes added.

A number of states have some form of medical marijuana law, including Washington, Oregon, Nevada, Alaska, Hawaii, Colorado, Main, Vermont, Rhode Island, Montana and California.

Federal drug enforcers note that the use of marijuana is illegal, and they point to a 2006 U.S. Food and Drug Administration study stating that marijuana has no medical value. "It is unequivocally illegal under federal law," said Casey McHenry, a spokeswoman for the Drug Enforcement Administration. "Our job is to enforce federal law, and the distribution or cultivation of marijuana is in clear violation."

California's position, determined by the 1996 passage of Proposition 215, is that the use of marijuana for medical purposes is legal. That, McHenry added, "doesn't affect what we do. We are still continuing to do our investigative work."

Tracking medicinal marijuana sales has been murky for years. Sellers, fearful of federal investigators, are hesitant to disclose information to state tax officials, whose records may be subject to review by federal authorities. State tax officials know that, but they say the transfer of information is limited.

"We do not have blanket information-sharing with different law enforcement entities, but in the event that there was a specific investigation going on, the Board of Equalization would be cooperative. But the board doesn't send information to the DEA as part of any kind of blanket agreement," said board spokeswoman Anita Gore.

Still, those who dispense the marijuana are nervous about the role of the federal government. "That is a danger, and it is a vulnerability in the system. We've raised incrimination and vulnerability as important issues," Hermes said.

Federal authorities, meanwhile, say income from marijuana sales is taxable and can lead to investigations of related criminal activities, such as money laundering. "With us, there is a potential for a criminal tax issue," said Arlette Lee, a spokeswoman for the IRS criminal investigations unit.

And the feds note that income from any source, legal or illegal, is taxable.

"Income, regardless of whether the source is legal or illegal, is taxable," Lee said.

eltone · 03-31-2008, 04:16 PM

Conflict and confusion that's what rules our country now regarding the use of marijuana be it medical or personal

. Ever since our government wanted to find a way to deport the mexicans who flooded the southwest after the 1910 Mexican Revolution, bringing the practice of smoking marijuana with them, thank God, they decided by prohibiting the use of marijuana they could use that as a tool to deport those marijuana smoking foriegnors. So you see the prohibiting of marijuana use was, in the beginning purely a racial issue. It had nothing to do with the physical and mental well being of its citizens for the Feds kept the scientific and medical communities out of the question when placing marijuana in a schedule 1 catagory and prohibiting its use. Why? Because the AMA did not want cannabis put in the schedule 1 catagory as it had been used safely and effectively for over 2,000 years of which medical documents exist stating the theraputically active effects of cannabis and the safety of its use. For no one can OD on THC, it is physically impossible. Ever since the ACP came out in favor of medical marijuana the government has been feeling the pressure from the people to legalize marijuana use medically and personnally. Why they allow us to eat and by OTC drugs that are fatal while prohibiting the use of marijuana smacks of political corruption

. It is very noticeable in politicians like Sen Tom Harkin D-Ia. who says, " If you smoke marijuana you will find yourself huddled in a corner willing to sell your children for just one more hit of marijuana." It is to laugh, yet it is sad that politicians in power are that prejudiced against marijuana use even in light of the true facts i.e. new medical evidence and support of medical marijuana from the ACP

. Plus the governments reason to keep cannabis illegal have nothing to do with good health. As the ACP said, "It is time that the government got out of the way of scientific and medical advances, research and treatments. Why do you think the feds don't want anyone to do research on Medical Marijuana (not schwag)? Because they already know of the theraputic effects and safety of using marijuana. The reasons they have for continueing the Prohibition of Marijuana are strictly based on power and money. It has nothing to do with the health and well being of the citizens that make up the country. I was taught in school that America was a government of the people, by the people and for the people. It looks more like a country of the rich, for the rich and by the rich. For with money you can control the government and laws of the nation. Also, what the hell is blinding these politicians from seeing the incredible financial benefits and opportunities in legalizing the cultivation and sale of marijuana/hemp as they do alcohol and nicotine? That, my friends is beyond my mental capacity. Trying to figure out the thought processes of politicians wears me out. Legalize marijuana TODAY and become a pest to your state Rep's by telling them to support Barney Franks Bill to decriminalize small amounts of marijuana in the Drunk Ole USA. If cannabis/hemp is not legalized soon this is where we are headed as a people and a nation

. Peace...

BillieBudd · 03-31-2008, 06:12 PM

I think that once California sorts out the tax problems, and other states, not to mention Feds, see what kind of tax revenue could be generated, it might bode well...Money will trump ideology and stupidity most times, expecially in this country...

carlover_36 · 04-01-2008, 12:24 AM

There's ALOT of money in this "war" on drugs. The feds spend Billions on it, what are the saleries of these people running all the anti-drug groups? Think about it.

I'd like to see a Million Pot-Head(stoner) march. Everyone just walk up to the Whitehouse (no, not the porn-site), sit down, and light up. Jail can only hold so many people. And then when the cops come, we all just sit peacefully and let them get agrvated. Show the closed minded that we are not wild, easily agrevated, or stupid. Let the media see what sort of lives we actualy lead.

Buzzby · 04-01-2008, 03:10 AM

Quote:

Originally Posted by carlover_36

I'd like to see a Million Pot-Head(stoner) march. Everyone just walk up to the Whitehouse (no, not the porn-site), sit down, and light up. Jail can only hold so many people.

Lot's of luck. Out of 24,000,000 cannabis consumers in this country, only 60,000 (0.25%) have bothered to join and support one of the three major pro-legalization organizations. That takes five minutes and costs $25. Getting a million of these lazy bozos to spend the time and money and risk their freedom to march on Washington? Not in this universe!

National Organization for the Reform of Marijuana Laws (NORML)

Marijuana Policy Project (MPP)

Drug Policy Alliance (DPA)

03-30-2008, 06:20 PM	#1
Pompo the Grey Tournaments Won: 7 Join Date: Sep 2006 Posts: 4,015 Grams: 55,756.56 Groans: 11 Groaned at 2 Times in 2 Posts Thanks: 2,230 Thanked 1,688 Times in 898 Posts Stock Portfolio Total Value: 0.000 Gain/Loss: 0.000%	CA : Medicinal marijuana puts tax collectors in tight spot Medicinal marijuana puts tax collectors in tight spot 3/27/08\|Capitol Weekly\| by John Howard In a tight budget year, California wants every tax dollar it can lay its hands on. This year, those hands are reaching for marijuana. More than a decade ago, California voters approved the use of marijuana for medical purposes, making it legal under state law. However, federal law enforcers say marijuana use of any kind is illegal - and they are raiding clinics to prove their point. The state tax appeals board, which wants the sales taxes, is stuck in the middle. "We're caught between a rock and a hard place," said Betty Yee, a member of the state Board of Equalization, which collects and distributes sales taxes on more than $553 billion worth of transactions each year in California on everything from corkscrews to Cadillacs. "We do not want to serve as aiding or abetting the (federal Drug Enforcement Administration). But they (the dispensaries) are not exempt from the sales tax, so by law we have to enforce it," Yee said. Yee's district encompasses all of coastal California from Santa Barbara to the Oregon state line and includes scores of marijuana dispensaries and thousands of medicinal users. Estimates vary wildly on just how much taxable marijuana is out there. The state, facing $16 billion in red ink through the middle of next year, wants precise numbers. So far, it doesn't have them. State authorities are quick to point out that collecting marijuana taxes won't balance California's books - but every penny helps. The Board of Equalization says it collected about $11.4 million in tax on some $142 million worth of medicinal marijuana sales in 2005-06, the most recent period for which numbers are available. That's likely a partial amount, because the board's taxation policy was adopted in October 2005, the final rule didn't go into effect until 15 months later, and it typically takes time to ramp up tax programs. About 200,000 people across California are authorized by their doctors to use marijuana for medical reasons. The drug costs about $40 for an eighth of an ounce. The sales of medicinal marijuana are tiny compared with other products, such as $20 billion in apparel sales and nearly $18 billion for office and school supplies. Even the smallest category - fuel and ice sales - among some four dozen listed by the tax board totals more than $414 million, nearly three times the level of the medicinal marijuana transactions. Marijuana vendors are listed as selling "general merchandise" - an attempt to give some anonymity to sellers who fear federal intervention. Americans for Safe Access, a pro-medicinal marijuana group that favors similar programs nationwide, says the state's figures are deceptive. The group surveyed a representative sampling of California dispensaries and tallied their sales, then multiplied that amount by the number of dispensaries in the state. ASA estimated the paid sales tax at about $100 million, and the amount of taxable sales at about $800 million. "This is a significant amount of money in a tough budget year," said ASA spokesman Kris Hermes. "We'd rather have the Board of Equalization be the entity that gives out that number, but they say it goes directly into the General Fund and there is nothing that requires the dispensaries to indicate what they sell. I hope over time that they will consider it, so it's not just us saying that we represent $100 million annually in sales taxes," Hermes added. A number of states have some form of medical marijuana law, including Washington, Oregon, Nevada, Alaska, Hawaii, Colorado, Main, Vermont, Rhode Island, Montana and California. Federal drug enforcers note that the use of marijuana is illegal, and they point to a 2006 U.S. Food and Drug Administration study stating that marijuana has no medical value. "It is unequivocally illegal under federal law," said Casey McHenry, a spokeswoman for the Drug Enforcement Administration. "Our job is to enforce federal law, and the distribution or cultivation of marijuana is in clear violation." California's position, determined by the 1996 passage of Proposition 215, is that the use of marijuana for medical purposes is legal. That, McHenry added, "doesn't affect what we do. We are still continuing to do our investigative work." Tracking medicinal marijuana sales has been murky for years. Sellers, fearful of federal investigators, are hesitant to disclose information to state tax officials, whose records may be subject to review by federal authorities. State tax officials know that, but they say the transfer of information is limited. "We do not have blanket information-sharing with different law enforcement entities, but in the event that there was a specific investigation going on, the Board of Equalization would be cooperative. But the board doesn't send information to the DEA as part of any kind of blanket agreement," said board spokeswoman Anita Gore. Still, those who dispense the marijuana are nervous about the role of the federal government. "That is a danger, and it is a vulnerability in the system. We've raised incrimination and vulnerability as important issues," Hermes said. Federal authorities, meanwhile, say income from marijuana sales is taxable and can lead to investigations of related criminal activities, such as money laundering. "With us, there is a potential for a criminal tax issue," said Arlette Lee, a spokeswoman for the IRS criminal investigations unit. And the feds note that income from any source, legal or illegal, is taxable. "Income, regardless of whether the source is legal or illegal, is taxable," Lee said.

03-31-2008, 04:16 PM	#2
eltone New Member Join Date: Jun 2007 Posts: 56 Grams: 2,187.77 Groans: 1 Groaned at 0 Times in 0 Posts Thanks: 37 Thanked 35 Times in 23 Posts Stock Portfolio Total Value: 0.000 Gain/Loss: 0.000%	MMJ Puts Tax Collectors in Tight Spot Conflict and confusion that's what rules our country now regarding the use of marijuana be it medical or personal. Ever since our government wanted to find a way to deport the mexicans who flooded the southwest after the 1910 Mexican Revolution, bringing the practice of smoking marijuana with them, thank God, they decided by prohibiting the use of marijuana they could use that as a tool to deport those marijuana smoking foriegnors. So you see the prohibiting of marijuana use was, in the beginning purely a racial issue. It had nothing to do with the physical and mental well being of its citizens for the Feds kept the scientific and medical communities out of the question when placing marijuana in a schedule 1 catagory and prohibiting its use. Why? Because the AMA did not want cannabis put in the schedule 1 catagory as it had been used safely and effectively for over 2,000 years of which medical documents exist stating the theraputically active effects of cannabis and the safety of its use. For no one can OD on THC, it is physically impossible. Ever since the ACP came out in favor of medical marijuana the government has been feeling the pressure from the people to legalize marijuana use medically and personnally. Why they allow us to eat and by OTC drugs that are fatal while prohibiting the use of marijuana smacks of political corruption. It is very noticeable in politicians like Sen Tom Harkin D-Ia. who says, " If you smoke marijuana you will find yourself huddled in a corner willing to sell your children for just one more hit of marijuana." It is to laugh, yet it is sad that politicians in power are that prejudiced against marijuana use even in light of the true facts i.e. new medical evidence and support of medical marijuana from the ACP. Plus the governments reason to keep cannabis illegal have nothing to do with good health. As the ACP said, "It is time that the government got out of the way of scientific and medical advances, research and treatments. Why do you think the feds don't want anyone to do research on Medical Marijuana (not schwag)? Because they already know of the theraputic effects and safety of using marijuana. The reasons they have for continueing the Prohibition of Marijuana are strictly based on power and money. It has nothing to do with the health and well being of the citizens that make up the country. I was taught in school that America was a government of the people, by the people and for the people. It looks more like a country of the rich, for the rich and by the rich. For with money you can control the government and laws of the nation. Also, what the hell is blinding these politicians from seeing the incredible financial benefits and opportunities in legalizing the cultivation and sale of marijuana/hemp as they do alcohol and nicotine? That, my friends is beyond my mental capacity. Trying to figure out the thought processes of politicians wears me out. Legalize marijuana TODAY and become a pest to your state Rep's by telling them to support Barney Franks Bill to decriminalize small amounts of marijuana in the Drunk Ole USA. If cannabis/hemp is not legalized soon this is where we are headed as a people and a nation. Peace... __________________ Peace Out

04-01-2008, 12:24 AM	#4
carlover_36 Member Join Date: Sep 2005 Posts: 379 Grams: 3,102.26 Groans: 0 Groaned at 1 Time in 1 Post Thanks: 29 Thanked 45 Times in 29 Posts Stock Portfolio Total Value: 0.000 Gain/Loss: 0.000%	There's ALOT of money in this "war" on drugs. The feds spend Billions on it, what are the saleries of these people running all the anti-drug groups? Think about it. I'd like to see a Million Pot-Head(stoner) march. Everyone just walk up to the Whitehouse (no, not the porn-site), sit down, and light up. Jail can only hold so many people. And then when the cops come, we all just sit peacefully and let them get agrvated. Show the closed minded that we are not wild, easily agrevated, or stupid. Let the media see what sort of lives we actualy lead. __________________ Stay Stoned

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03-31-2008, 06:12 PM	#3
BillieBudd Jr. Member Join Date: Oct 2005 Posts: 120 Grams: 1,968.89 Groans: 0 Groaned at 0 Times in 0 Posts Thanks: 13 Thanked 41 Times in 28 Posts Stock Portfolio Total Value: 0.000 Gain/Loss: 0.000%	I think that once California sorts out the tax problems, and other states, not to mention Feds, see what kind of tax revenue could be generated, it might bode well...Money will trump ideology and stupidity most times, expecially in this country...

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