A Marijuana Tax Hike in Oakland and Nobody Minds

by Matt Kelley · 2009-07-01 05:42:00 UTC
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Voters in Oakland are considering a 1500% increase in the city's tax on medicinal marijuana sales, and the measure has a group of supporters that rarely lines up behind any tax hike: everyone.

The city's four marijuana dispensaries were behind the initial proposal to put the tax increase on the July ballot, which has been mailed to Oakland voters and is due by July 21. The new law would increase the tax per $1,000 in receipts from $1.20 to $18 and would make Oakland the first city in the country to directly tax pot sales. Based on marijuana sales from 2007 and 2008, this new tax would bring the struggling city as much as $290,000 in additional revenue next year.

Marijuana sales appear to be recession proof and club operators say they can afford the new tax.

"The market for cannabis is so strong that we'll be able to absorb the cost," (dispensary operator Richard) Lee said.

Lawyer James Anthony wrote the tax law on behalf of the dispensaries.

"It's really about local government and local needs and providing access to medicine for patients in a way that works for the community and for the city," Anthony said.

The dispensaries also support the proposed law because fair taxes are a step toward legalization. The increased public revenue certainly makes legal pot look more attractive to lawmakers.

It seems that a 1.8% tax on medicinal marijuana probably isn't the ceiling, either. Especially if it moves from medical only to general consumers, it would be easy to imagine combined city, state and federal taxes as high as 10% - and nobody would mind because the quality and safety of the drug would improve while the overall price would likely drop.

On another note, the Los Angeles City Council this week moved to close 28 medical marijuana dispensaries in the city. One step back...

Matt Kelley is the Online Communications Manager at the Innocence Project and a graduate of the Medill School of Journalism at Northwestern University. Follow him on Twitter @mattjkelley.
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