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Will Medical Marijuana Help Close The Budget Gap?
Thursday, Mar. 10, 2011
I saw a bumper sticker this week that said, “Tax the rich…they can afford it.” But what happens when the tax hits the poor?
This week, the City of Los Angeles voted to tax medical marijuana receipts, leading one advocacy group to say, “patients already pay a nearly 10 percent (sales) tax on the medication that’s already expensive and unaffordable to many.”
The measure was passed by an overwhelming majority, and is seen as one way to generate $10 million per year to pay for basic city services. The budget shortfall in Los Angeles is $350 million. Several other California cities, including San Jose, Oakland, and Sacramento impose “gross reimbursement” taxes.
Medical marijuana advocates are not the only ones expressing concern. Legal staff in both the city and county says the city should not tax something the federal government considers unlawful. City Council President Eric Garcetti pointed out another question: “If marijuana is supposed to be medicine, you can’t tax medicine. And if it is a gross receipts tax on a business, these (dispensaries) are not supposed to be businesses.”
The number of collectives is multiplyingthroughout the state, but not all are designated as nonprofits cultivating and selling marijuana for medicinal use. What do you think about the new taxes? What is the best way to treat the legal dispensaries fairly? Is it ethical to collect taxes on something illegal? Post your comments here.
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