Upcoming marijuana tax too high, says UW prof

0

The legalization of marijuana is almost upon Canadian citizens, despite a cloud of controversy.

An important aspect of this new legislature is taxing of such substances, common for those considered “harmful” to society – namely, “sin tax.”

A sin tax is one implemented by the Government of Canada in an effort to control or reduce consumption of these harmful substances. It also helps augment the revenue generated by the government and is usually more favourable to increasing sales or income tax.

The federal government has so far proposed a sin tax of ten per cent on recreational marijuana. Many professionals, such as Bruce Lipton, the CEO of Canopy Growth Corp., agree with this figure since it is lower than sin taxes on other products, such as alcohol.

Anindya Sen, director of the master of public service program and an economics professor at the University of Waterloo, however, disagrees. He calls the tax “ridiculous,” and argues that a tax as small as a dollar is liable to produce a black market.

Sen wrote a letter to Bill Blair,  parliamentary secretary to the ministers of justice and health, suggesting the tax be ten per cent overall, stating that this would minimize possible black market activity.

Sen uses Colorado as an example, which reportedly has an active black market due to an excessive sin tax.

Professor Sen published research on cigarette taxes and how it has affected smoking. His work is widely cited on the retail of alcohol and deregulation of marijuana.

This site uses Akismet to reduce spam. Learn how your comment data is processed.