Because of the pandemic caused by Covid 19 our Government has borrowed enormous sums of money to support people and businesses over the past year. How will these sums be repaid?
The traditional way to raise money is through increased taxation of income, profits or capital, but at a time when many people have lost their jobs and businesses are struggling this is likely to be deeply resented and very unpopular and threfore an alternative source might be sought. Perhaps now is the time to legalise soft drugs and, in particular, cannabis the sale of which through Government licensed outlets could be a source of large sums from tax paid on sales, a tax which is unlikely to be resented.
Several countries have legalised cannabis for recreational as well as medical use including Canada, Georgia, Uruguay and South Africa as well as 15 states in the USA with a further 16 having decriminalised its use. In 35 states medical use has been legalised as is also the case in 16 countries in Europe.
The following give a couple of examples of the sums involved:
In the state of Colorado, which has a population of 5.5 million, licensed businesses began selling cannabis in January 2014 and by 2016 sales amounted to $1.3 billion generating more than $200 million in tax and license fees of which $1.38 million went to the Colorado Department of Education. The growing, testing, licensing and sale of cannabis created more than 18,000 full time jobs. Police arrests and court apearances decreased by 80% freeing court and police time for more serious offences and usage among teens, which remains illegal, decreased slightly.
In Washington state production and sale in licensed outlets became legal in November 2013. In 2016 sales were $1.1 billion generating tax of $315 million from a popultion of 7.6 million. Use by teens, which remains illegal, has remained stable over the past decade.
In the Netherlands, which has a population of 17 million revenue from taxes amounted to some 400 million euros in 2019. The licensed sale of cannabis was decriminalised many years ago.
Strict testing and regulation of cannabis would ensure purity and control its strength thus making it safer and it would be sold only from licensed premises to adults. Cutoms and excise and police officers would be released to pursue more serious crimes.
Tax from the sale of tobacco in 2019/20 generated £8.8 billion in tax in the UK. In a few years taxes from the legal sale of cannabis could clear the Government debt. Legalisation of cannabis has been discussed for many years; perhaps now is the time to act.
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