Tax debate highlights rift in cannabis movement

Volunteers hand out joints on the Pearl Street Mall.
Photo courtesy of

On Sept. 23, there was a “free joint giveaway” on the Boulder Pearl Street Mall that was organized by the “No on Proposition AA Committee.” More than 1,000 cannabis cigarettes were given away to call attention to the marijuana tax issue that will appear on the Nov. 5 ballot.

Marijuana sales are already subject to a 2.9 percent statewide tax, along with other local taxes. Prop. AA would apply to retail marijuana sales that will be regulated under Amendment 64. Prop. AA asks voters to approve an additional 15 percent excise tax on wholesale transfers of cannabis to raise an estimated $27 million to fund school construction, and an additional 10 percent to 15 percent sales tax to raise an estimated $33 million to fund a new marijuana police force.

A64 was promoted to voters as a system to regulate marijuana “like alcohol.” However, since taxes on alcohol are less than 1 percent on average, the “No on Prop. AA” campaign believes voters should be outraged at this bait-and-switch tactic to tax cannabis at a rate much greater than alcohol.

This tax debate highlights what has become a very clear division between cannabis supporters. There are those who support an expensive “strict regulation” model paid for by high taxes, and there are those who continue to support simple “legalization” with reasonable taxes and regulations.

To most people, “legalization” means that prohibition laws are repealed, people are no longer punished for cannabis use, and police resources are used to fight serious crimes. However, A64’s “strict regulation” model does the opposite of this in many cases. The A64 model allows some people to have some marijuana at some times, but it continues marijuana prohibition for other people with other amounts of marijuana at other times.

For example, under A64, you can possess one ounce and six plants. But if you possess 1.000001 ounces or 7 plants, you are still considered a marijuana criminal. In addition, since A64 passed, almost 300 pages of new marijuana law and penalties have been added to the books.

To enforce all the new marijuana crimes, Prop. AA would raise an estimated $33 million for the Department of Revenue’s Marijuana Criminal Enforcement Division (MCED), the first police force in the nation dedicated solely to marijuana law enforcement.

The MCED’s “seed-to-sale” tracking system, described in a Boulder Weekly article in the June 2, 2011, issue, is at the heart of A64’s “strict regulation” model. This system, now called the Marijuana Inventory Tracking System (MITS), will require dispensaries to use expensive Radio Frequency ID (RFID) tracking technology to track their inventory through every step of the cultivation, production and sales process. If a gram falls on the floor or an ounce walks out the door, the MCED pot police will know about it in real time.

Now, instead of “legalizing” marijuana for everyone, A64 has created a new scenario of “good pot smokers” vs. “bad pot smokers.” The “good pot smokers” are the ones willing to pay exorbitant taxes and allow the MCED to track their cannabis more strictly than plutonium. The “bad pot smokers” are the ones that will continue to purchase cannabis from their friends (or the evil “black market,” as the Prop. AA supporters call them) because they value their privacy and are against over-taxation.

Under Prop. AA, marijuana consumers will pay almost $100 in tax on each $300 ounce. Ironically, the previous penalty for possession of two ounces or more (before A64 passed) was a $100 petty offense ticket (no jail time, no criminal record). And that was if you got caught (and very few people were.) Under Prop. AA’s 30 percent-plus tax, you will be expected to pay that $100 penalty every time you purchase an ounce, and this money will be used to fund the MCED marijuana police to go after all the new marijuana crimes.

If Prop. AA passes, the “good pot smokers” will actually be funding the police to target and punish the “bad pot smokers,” and we will have one more new, well-funded police force that will need to be dismantled in order to bring about true “legalization.” When cannabis is finally really “legalized,” all pot smokers will be “good pot smokers,” no one will be punished, and there will be fewer laws and fewer police needed to enforce them. Voting for exorbitant taxes on marijuana consumption only continues the same prohibition tactics that have been used against cannabis consumers since the original Marihuana Tax Act was passed in 1937.

Laura Kriho has been a cannabis re-legalization activist in Boulder since 1992.