Article by Richard Cowan, former NORML National Director and author of Things To Know Before Vaping CBD
A year ago, IllinoisPolicy.org, a think tank devoted to improving the state’s economic policies, warned that the “ILLINOIS CANNABIS TAXES AMONG NATION’S HIGHEST, COULD KEEP BLACK MARKET THRIVING”
“Springfield lawmakers have yet to learn the lesson that money walks. And it’s not just to other states. Sometimes, it walks past the legal dispensary with a 40% tax rate and into a dealer’s house…
“Even in Illinois, which financial forecasting service Kiplinger dubbed the least tax-friendly state in the nation, weed buyers had sticker shock.
“Of the 10 states with legal recreational marijuana regimes, Illinois is home to the second-highest tax burden on retail sales, according to a review of state and local statutes. In Chicago, customers will pay up to 41.25% in taxes on some marijuana products, after factoring in a soon-to-be-passed Cook County excise tax. That total doesn’t even include a 7% state wholesale tax further up the supply chain, which will be passed down to consumers through higher prices.”
Now, MarijuanaMoment.com is reporting, “Illinois Awards $31.5 Million In Marijuana-Funded Grants To Repair Communities Harmed By Drug War”.
Over the years that I have been involved in the marijuana legalization movement I have frequently written about the disproportionate impact of marijuana prohibition on communities of color, but poor whites have also been badly hurt. In any case, taxing marijuana users to compensate anyone for the damage done to marijuana users is absurd.
Should we tax Kosher delis to pay reparations to victims of anti-Semitism? Or perhaps tax Sushi bars to pay reparations for the internment of Japanese Americans during WW2? Or perhaps we should tax gay bars to compensate victims of homophobia??
On the other hand, The Wall Street Journal is reporting that the rapper Jay-Z is putting up $10 million to fund African American entrepreneurs in the cannabis business.
That is the way it should be done. The billionaire rapper will also bring management expertise with private capital. In every case, the primary objective must be to liberate marijuana from the black market and the violence created by marijuana prohibition. It must also separate marijuana from hard drugs. That is only possible with legalization.
Poor communities need locally owned businesses to cater to the needs of their people, but these minority entrepreneurs also need the capital and the business expertise to make money selling to the entire economy. Ironically, these communities and their local businesses will be the ones most hurt by the perpetuation of the black market by high taxes — and excessive regulations — of the “I’m from the government and I’m here to help you” brigade.
In any case, the pandemic has done so much damage to the entire economy that we all need realistic policies for the newly emerging cannabis industries. (Plural)
There are going to be even more vacant stores, restaurants, bars, coffee shops, and especially entertainment venues, etc in our cities. We need to simplify the startup process for entrepreneurs and keep taxes to a minimum. Politicians see businesses as sources of taxes, but they need to learn to think first about economic activity, and that is what will produce real growth and opportunities for everyone, but especially the minority communities. And then tax revenues.
Why am I so often reminded of the line from James Thurber’s little poem, The Peacelike Mongoose?
“Moral: Ashes to ashes, and clay to clay, if the enemy doesn’t get you your own folks may.”