Report To Address How To Tax And Sell Marijuana

Nov 17, 2014

In January, lawmakers will receive a detailed report analyzing many of the issues surrounding the possible legalization of marijuana in the state.

Supporters are hoping that these specific concerns can be addressed if the Legislature wants to move forward with this issue during the 2015 session.

The study will not make recommendations either for or against the legalization of marijuana in Vermont. Instead it will outline a number of policy areas that need to be considered if an effort is made to legalize the recreational use of marijuana.

Beau Kilmer is the co-director of the Drug Policy Research Center at the Rand Corporation. He’s says the first step is to determine what he calls “Vermont’s marijuana landscape.” That’s a phrase to estimate how many people currently use marijuana.

The first step is to determine "Vermont's marijuana landscape," an estimate of how many people currently use marijuana.

“And so we’re able to kind of cobble together information from surveys what we know about misreporting, information we have about total amount consumed, we’re able to put that together to come up a range,” said Kilmer. “So I’m optimistic about the future of marijuana market studies.”

Kilmer says establishing a fair price for marijuana products is another critical step because if the price is too high, then the state’s existing black market for marijuana will continue to thrive.

This leads to the question of how to tax marijuana. Kilmer says imposing a tax based on the weight of the product can have an unintended effect on the potency of the marijuana that is sold here.

“With that particular model what that does is that it creates incentives for producers to produce more potent pot,” said Kilmer. “And for purchasers to purchase more potent pot.”

Establishing a fair price for marijuana products is another critical step, says the Rand Corporations' Beau Kilmer. If the price is too high, then the state's existing black market for marijuana will continue to thrive.

There’s also the question of where the marijuana will be sold. Kilmer says the state’s current system of selling hard alcohol at selected stores isn’t going to work because the federal government still considers marijuana to be an illegal drug.

“Now if you were to kind of go down the state monopoly road that would have the state forcing their employees to violate federal law,” said Kilmer.

There have been estimates that the state could raise roughly $15 million in new revenue if marijuana is legalized.

Kilmer says the Rand report will specifically address this issue by including a detailed analysis of the potential revenue gains for the state.