Home / Articles / Views / Weed Between the Lines /  Marihuana Tax Act of 1937 rises from the dead
. . . . . . .
Give Through iGivefirst
Thursday, October 31,2013

Marihuana Tax Act of 1937 rises from the dead

By Laura Kriho
Samuel Caldwell's mugshot in 1937.

Nothing is more scary on Halloween than the undead. Zombies, ghouls, vampires — all were once dead, but were resurrected and now terrorize living society. It is both frightening and frustrating to think you have finally put something evil to rest with a silver bullet or a stake through the heart, only to find that it has risen from the dead and found new life.

So the fright of pro-cannabis voters was real when we saw that the Colorado legislature wanted to resurrect the most heinous and destructive thing in the history of cannabis prohibition: the Marihuana Tax Act of 1937. Timothy Leary had put this grotesque creature to death in 1969 when he won a landmark U.S. Supreme Court case. Now, a similar monster is being revived by the Colorado legislature as the Marijuana Tax Act of 2013, now known as Proposition AA.

The Marihuana Tax Act of 1937 was primarily the unholy creation of Harry J. Anslinger, head of the Federal Bureau of Narcotics from 1930 to 1962. Anslinger had made his career enforcing alcohol prohibition, but when that was repealed in 1933, Anslinger needed a new illegal substance to secure his job.

“Marihuana” was a perfect target: It was used primarily by minorities who were feared by the public due to newspaper mogul William Randolph Hearst’s nationwide “Reefer Madness” campaign to demonize cannabis and hemp. Hearst was a racist who used the little-known term “marihuana” to describe what had always been commonly known as cannabis or hemp. Hearst ran a very effective scare campaign to convince the public that “Mexicans and Negroes” were smoking a new drug called “marihuana” that was causing them to rape and murder white people.

The Marihuana Tax Act of 1937 used a unique legal theory. Since Congress did not have the power to ban substances directly because of the 10th Amendment, they needed an indirect method of prohibition. They were inspired by the National Firearms Act of 1934, which effectively outlawed machine guns through the requirement of a “prohibitive” tax.

The Marihuana Tax Act adopted the “prohibition through taxation” scheme. Rather than making marijuana possession illegal directly, the law required you to purchase a tax stamp in order to possess marijuana legally. Because the taxes were set prohibitively high, it discouraged compliance, creating de facto prohibition.

Congress passed the law with very little debate, despite testimony by farmers, who complained that the law would destroy the hemp fiber and seed industry, and from the medical community, who complained that cannabis had been in the U.S. pharmacopoeia since 1850.

The new law went into effect on Oct. 1, 1937. A few days later, Denver’s own Samuel Caldwell became Anslinger’s poster boy as the first prosecution under the new Marihuana Tax Act. Caldwell, a 58-year-old Denver resident, was arrested for possessing and selling marihuana without being in possession of his tax stamp. Caldwell was arrested on Monday, Oct. 5, indicted by a federal grand jury on Thursday, Oct. 8, and sentenced to four years in Leavenworth Federal Penitentiary on Friday, Oct. 9.

Caldwell’s speedy prosecution was front-page headlines throughout the country. Anslinger himself traveled to Denver from Washington, D.C., for the photo opportunity at Caldwell’s sentencing.

The Marihuana Tax Act proved an effective method of prohibition, and the legal hemp and cannabis medicine industries soon disappeared. However, in 1969, Timothy Leary’s conviction for possession of marijuana without a tax stamp was overturned by the U.S. Supreme Court. Since marijuana was illegal on a state level in many places, the Court ruled that the federal tax stamp requirement violated Leary’s Fifth Amendment right against selfincrimination.

Now, in 2013, the 1937 Marihuana Tax Act has been revived from the dead as Proposition AA, which proposes a prohibitive tax of up to 30 percent on cannabis. This would be the highest tax on a product in Colorado history. For comparison, alcohol is taxed at a rate of less than 1 percent.

Prop. AA is a regurgitated abomination of the 1937 law, and it is supported by the most anti-marijuana people in the state, including Gov. John Hickenlooper, Attorney General John Suthers (Harry Anslinger’s modern resurrection) and Smart Colorado (channeling Hearst’s Reefer Madness propaganda).

The only difference this time is that, thanks to TABOR (Taxpayer’s Bill of Rights), the voters get to decide the fate of this demon tax act. Will voters pump new life into this Fiscal Frankenstein, or will they put a stake through its heart again?

Laura Kriho works with the Colorado 420 Coalition (www.Colorado420.com).

Respond: letters@boulderweekly.com

  • Currently 3.5/5 Stars.
  • 1
  • 2
  • 3
  • 4
  • 5
No Registration Required

If you really think Prop AA is a prohibitive tax, have a look at Washington's I-502. 25% tax whenever cannabis changes hands, such as from grower, to store, to customer, plus I believe they can tack on local taxes as well. 15% 10% is way better than 25% 25% 25% sales tax, and it is the only way (with most cities and counties opting out) that the promise by A64 of money for schools can actually happen. It's not this great big terrible tax that would keep the black market alive. As a responsible adult toker, I would like to make good on the promise that legalized cannabis will bring in tax dollars to the state, especially to help improve the education of children.


So since MMP wrote worse language in WA state--Coloradans should be thankful we don't have it as bad and pass an additional 30% tax on cannabis? Forget it. Yeah and tonight on 7 news they mentioned the BEST Program (the entity receiving the school construction excise tax, if passed) also failed their audit on how and where they chose to spend monies....and I say also because the DoR MMED FAILED their pot audit and so did the CDPHE and the city of Denver....amazing--4 failed audits and yet you want to reward them tens of millions more.....because it's 'better' than WA....disgusting. Aside from the fact that Americans don't vote for excessive taxation.



The Intellect of these two Ladies CAN NOT be Denied!  The BLACK MARKET is Looming on these HIGH POT TAXES passing, so get ready for Another Failed Wave Of Prohibition!  WHEN, OH WHEN can a real citizen led coalition bring SANITY back to the Ballot For THE PEOPLE? Legal Patients will soon NEED a Bill of Rights, exempting patients from unfair laws singling them out for DUI-D convictions, illegal police databases, Harrassment over personal growing opportunities, with Caregivers, and Physicians, etc.