States Push to Get the Most Out of Marijuana Taxes

 http://www.nytimes.com/2013/04/25/us/col…

The link above is very interesting and discusses how marijuana would be taxed if it became legal.  Colorado recently voted in favor for legalizing small amounts of marijuana for recreational use.  Taxes on marijuana could be as high as 30%! The main goal is to set taxes high enough to finance the administration of new laws.  Check out the link to read more about this topic.

 

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2 Responses to States Push to Get the Most Out of Marijuana Taxes

  1. Kevin Leary says:

    I am just skeptical at the feasability of the tax working. It seems to me if the tax causes a significant increase in the price of marijuana then people may still look towards purchasing the product illegally in order to save more money and not have to go through extra hastle in order to purchase it. I also think that there are many people who would be opposed to legalizig marijuana for recreational use.

  2. salvitta says:

    The article proclaims that the state is attempting intervene in the new marijuana market by possibly raising taxes sharply. The state must be careful of how high they raise taxes because they could cause a crowding out affect on the market, which would hurt both the consumers and the producers. For example, the consumers could resort to the black market, which take away profits from legal marijuana businesses and these transactions would be tax free. Personally, I believe in a neoclassical approach to the marijuana market, because I believe the state should take a hands off approach, allowing the market to self regulate its prices.

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