Expert: Federal Law Will Hamper States’ Efforts To Tax Marijuana


Federal law will hamper states' efforts to tax marijuana, expert says As the debate continues on legalizing and taxing marijuana in the climate of growing budget deficits, a Vanderbilt University Law School professor has said that although the proposal sounds simple, there are too many legal hurdles for it to work.

In a new paper, professor Robert Mikos wrote that the federal ban on marijuana would cripple a state’s ability to collect taxes because it encourages marijuana distributors to remain small and continue to operate underground. Moreover, it prevents states from being able to monitor or tax the distributors.

Mikos also pointed out that even if states could successfully monitor marijuana distributors, any information they collected could be used by federal law enforcement to prosecute dealers.

"Federal law enforcement officials could use any information the states gather to track down and sanction marijuana distributors," he said, adding that "the federal ban would thus encourage distributors to evade state tax collectors."

According to Vanderbilt University, activists in states such as California who advocate legalizing marijuana claim the move could generate more than a billion dollars and save millions more by reducing law enforcement costs on prohibition enforcement.

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