Health officials discussed taxing legal marijuana

Health Canada has discussed whether it would be possible to collect a
tax on legal marijuana.

The department grappled with that question and many others associated
with the possible decriminalization of marijuana, according to
documents obtained by the Citizen.

The question of taxation was raised in a Nov. 15, 1996, memorandum
from the director of the Bureau of Drug Surveillance to the
department's Policy and Scientific Affairs branch:

``Would it be possible to regulate cannabis to decrease the potency of
marijuana? To obtain tax revenues?

``Section 55 of the Controlled Drugs and Substances Act provides
authority to the Governor in Council to make regulations respecting
the medical, scientific and industrial uses of controlled substances
(including marijuana). It would appear that potency of marijuana
could be regulated for medical use but not for recreational use.''

The document was one of a series recently obtained through an Access
to Information request by Ottawa researcher Ken Rubin. The documents
show that in 1995 and 1996, officials at Health Canada wrestled with
various possibilities that might arise if marijuana one day became
legal or was decriminalized.

``There is a lot we don't know about cannabis and its effects, and
what we do know is not reassuring, but neither is it cause for
excessive alarm,'' says an August 1995 discussion paper circulated
within the department to stimulate a policy discussion on the issue.

In written exchanges, Health Canada officials also discussed
marijuana's potency and addictive qualities, and its harm relative to
alcohol and tobacco. They also raised the issue of regulating the
drug's potency for taxation purposes.

The writer of the memo, bureau director Bruce Rowsell, was out of the
country and unable to speak with the Citizen yesterday.

When asked how the question of taxing marijuana first arose, Mohammad
Kasem, the bureau's associate director, said: ``I read the same
document as you did. I can't say any more than what's in there.'' He
added: ``The question of tax wouldn't be relevant until the
criminalization or decriminalization is worked out.''

That could happen as early as next month when a London, Ont., judge
rules in the marijuana possession case of a London hemp store owner.
The judge has been asked to strike down the Criminal Code's marijuana
prohibition on the grounds it is a violation of the Charter of Rights
and Freedoms.

The issue of taxation has been raised by those who favour the
legalization of marijuana.

They suggest the government is forfeiting a tax windfall and lining
the pockets of criminal drug dealers.

Marc Emery, a Vancouver marijuana activist and hemp store owner, has
estimated that B.C. marijuana injects $800 million a year into the
underground economy, and costs governments $250 million in tax
revenue.

Others, such as OttawaCarleton Police Chief Brian Ford, favour
legalizing soft drugs because enforcing the law is a financial drain
on alreadystrained police and court resources.

However, the bureaucrats at Health Canada were far more reticent to
recommend such a bold change in policy.

``If some form of possession offence is not maintained, even if only
punishable by a ticketing/confiscation scheme, the drug strategy as a
whole could gradually unravel, with unpredictable consequence,''
writes one policy analyst in a September 1995 memo.

``The law is a crucial underpinning of the drug strategy as a whole,
even if the specific deterrent effect of the legal component is
difficult to demonstrate unequivocally.''