Yale Budget Lab suggests a $0.00625/mg federal tax on THC, at the producer level.
They included what the DEA said about “Marijuana, in its natural form, is one of the safest therapeutically active substances known to man” with what are known as the Sin Taxes: alcohol and tobacco, by the same agency which also taxes firearms and bullets, formerly known as the Bureau of Alcohol, Tobacco, and Firearms (BATF).
Not to bury the lede, but that one acre of hemp will produce enough THC to be taxed at over $8,000 an acre!
Even if growing for grain and producing say half as as much flowers mixed amongst the seeds, say 500 pounds, that’s an unconscionable $4 grand an acre tax on Hemp, making it financially impossible.
That gives you a sense of scale of a tax on a plant not a product like spirits or beer or cigarettes, as if they taxed corn, barley, and tobacco leaves. And more: that plant is ubiquitous, grown in almost every county in the country, even feral in thousands of ditches.
“Federal legalization would raise $57.9 billion over ten years and federal plus remaining state legalization would raise almost double that” at $0.00625/mg THC via TTAB.
“For distilled spirits, the federal rate is $13.50 per proof gallon effectively taxing the pure alcohol content rather than the finished product. (A proof gallon is defined as one liquid gallon at 50 percent alcohol by volume.)
Beer is taxed at $18 per barrel (31 gallons) for large domestic producers, with a reduced rate of $3.50 per barrel on the first 60,000 barrels for domestic brewers producing fewer than two million barrels annually;
wine is taxed on a graduated schedule ranging from $1.07 to $3.40 per wine gallon depending on alcohol content and type, with additional rates for sparkling and artificially carbonated wines.
Cigarettes generally carry a federal excise of $1.0066 per pack of 20 though it differs by the size of the cigarette.
Smokeless tobacco is taxed by weight — $1.51 per pound for chewing tobacco and $26.84 per pound for snuff — and
cigars are subject to an ad valorem rate capped at $0.4026 per cigar depending on size.”
Click here to see the report from Yale.
