TAXES ON MARIJUANA, PORNOGRAPHY ARE PROPOSED

Missouri lawmakers would tax marijuana and other controlled substances by
letting the state seize assets when a drug dealer is caught.

JEFFERSON CITY - If you thought the government had taxed just about
everything, the Missouri Senate has come up with two more ideas: pot and porn.

Faced with big budget cuts, lawmakers are scrambling for different ways to
soften the financial blow to state agencies. Two unique ideas surfaced
Friday as senators started - but didn't finish - a lengthy debate over how
to raise more money.

One idea would be to put a 5 percent gross receipts tax on the sale of "all
adult entertainment products and services." This part of the bill would
cover businesses that offer live performances of "actual or simulated
sexual activities."

This idea would raise an estimated $5 million a year. "Unfortunately, it's
a burgeoning industry in this state," said the sponsor, Sen. Charlie
Shields, R-St. Joseph.

Another part of Shields' bill would place a tax on marijuana, domestic
marijuana plants and controlled substances. Shields said he did not expect
drug dealers to notify the state of their business activities. But under
such a law, if a drug dealer was caught, the state could seize assets
because the dealer did not pay the proper state taxes.

Shields said Iowa and North Carolina already have such a law. Such a tax
could raise about $6 million a year in Missouri, with half going to schools
and half to law enforcement.

These two approaches were part of a much broader bill designed to raise
more than $180 million in state revenues without a general tax increase.
More than $120 million of this total would be from one-time sources of
money, meaning that lawmakers could not rely on them to plug future budget
gaps.

The Legislature is also considering ideas such as raising state taxes on
cigarettes, passing a temporary sales tax and doing away with the $500 loss
limit at casinos.

Most of the discussion Friday centered on whether the state should sweep
interest out of scores of special state government accounts, such as the
"endowed care cemetery audit fund" and the "gaming proceeds for education
fund."

Critics said the bill had so many controversial provisions, it would be
overturned in court. Sen. Ken Jacob, D-Columbia, said the plan would "put
the governor in the position that he has a budget built on a house of
cards, and he has to cut."

Lawmakers are supposed to complete work on the budget by May 9. The session
adjourns May 16.

The approaching deadline worries Senate Appropriations Chairman John T.
Russell, R-Lebanon. "Here we are with two weeks left, and we don't have any
new revenue," he said.

The bill is HB600.