Pubdate: Wed, 09 Jun 2004 Source: Windsor Star (CN ON) Copyright: The Windsor Star 2004 Contact: http://www.canada.com/windsor/windsorstar/ Details: http://www.mapinc.org/media/501 Author: Eric Beauchesne, CanWest News Service Note: Read the full 40 page study http://www.fraserinstitute.ca/admin/books/files/Marijuana.pdf Cited: Canadian Senate report http://www.cannabislink.ca/gov/#SENATE Bookmark: http://www.mapinc.org/mjcn.htm (Cannabis - Canada) Bookmark: http://www.mapinc.org/decrim.htm (Decrim/Legalization) TAX POT, STUDY URGES Fraser Institute Estimates Revenues Could Hit $2B A Year OTTAWA - Marijuana should be legalized and then taxed like any another other product, says a study by an economic think tank. The Fraser Institute estimates that such a move would easily generate over $2 billion a year in additional tax revenues. All that would really change is that governments, rather than criminals, would enjoy the spoils, argues the study being released today by the Vancouver-based institute. The potential tax revenue is based on the study's estimate that in British Columbia alone, the annual marijuana crop, if valued at retail street prices and sold by the cigarette, is worth over $7 billion. "Using conservative assumptions about Canadian consumption, this could translate into potential revenues for the government of over $2 billion," states the study. "In British Columbia -- as in other provinces, notably Quebec and Ontario, it is a significant crop that fuels organized crime." 17,500 GROW OPERATIONS Study author Stephen Easton, professor of economics at Simon Fraser University and a senior fellow at the institute, estimates that there are as many as 17,500 marijuana grow operations in B.C. alone. Marijuana is widely produced and about one quarter of Canadians admit to having used it, the study says. As such, the broader social question has become not whether to approve or disapprove of production, but rather who should enjoy the spoils. "If we treat marijuana like any other commodity we can tax it, regulate it, and use the resources the industry generates rather than continue a war against consumption and production that has long since been lost," said Easton. "It is apparent that we are reliving the experience of alcohol prohibition of the early years of the last century." In British Columbia, indoor marijuana cultivation and consumption appears to be higher than in the rest of Canada, it notes. The most striking difference is that only 13 per cent of offenders in the province are actually charged while that number climbs to 60 per cent for the rest of Canada. In addition, the penalties for conviction in B.C. are low, it said. Fifty-five per cent of those convicted receive no jail time. While police resources are spent to destroy nearly 3,000 marijuana grow operations a year in B.C., the consequences are relatively minor for those convicted, it says. The industry is simply too profitable to prevent new people moving into production and old producers from rebuilding. A modest grow-operation of 100 plants generates $80,000 a year in gross revenues, and with production costs of about $25,000, the potential return on invested money is a high 55 per cent, it says. It currently costs $1.50 to produce a marijuana cigarette, which sells for $8.60. - --- MAP posted-by: Larry Seguin