07/20/2016 10:48 EDT | Updated 07/20/2016 10:59 EDT

Use Marijuana Tax Revenues To Treat Related Public Health Issues

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Hand holding smoking joint

The Task Force on Marijuana Legalization and Regulation is up and running. And run it will in order to have a detailed set of recommendations for its November deadline. It has lots of issues to consider as indicated by its discussion paper and beyond. Protection of children in the shift from criminalization to regulation must be paramount.

Taxation raises a lot of questions. There's no doubt that marijuana, itself, and the industry and its employees, agents, etc. should be taxed. One of the main arguments for legalization and regulation is that it will impose levies on the cannabis industry, ending its illicit tax-free days. How much to tax is a critical issue: too low and the levies, even combined with other strategies, won't have much impact dampening harmful consumption; too high and the illicit market can creep back in (we've seen this happen with cigarettes).

At any rate, taxation produces revenue for governments. What should be done with the flow derived from marijuana? Monies from taxes on cannabis could simply be directed to the general revenue pool of government. However, for two compelling reasons, the task force should recommend that any legislation regulating marijuana should stipulate that funds should be earmarked for public health issues related to cannabis.

First, the goal of taxing drugs is to discourage harmful consumption. The money raised through those taxes will have more impact if it is used to support prevention and counselling than it will by becoming part of general revenues used for various purposes. Second, the taxes will more likely be supported by the public if they are used for these specific ends.

There are a number of interventions to reduce damaging consumption and respond to harmful use, such as educational and treatment programs, that require significant resources. One means to at least partially offset these costs is for legislatures to stipulate that the funds raised by taxes should be dedicated to these various efforts.

Targeting tax funds could also engender support for these levies. Evidence for such approval comes from efforts to impose taxes on junk food. For a number of reasons there has been a big push to tax sugar-sweetened beverages (SSBs). Advocates of this levy suggest that public support will be further enhanced if it is known that the funds will be used to fight obesity and related purposes.

They cite a 2008 poll of New York State residents in which 52 per cent of respondents supported a soda tax; 72 per cent did so if the revenue was to be used to prevent obesity. A 2011 poll in Massachusetts revealed that 69 per cent would support a sales tax on soda if revenues went to schools or anti-obesity programs focused on children; results were split nearly evenly if respondents were not given information about how funds would be used.

Proponents underscore the point arising from this increased percentage: support is highest when the tax is viewed as promoting health (rather than raising revenue) and where the funds are dedicated to prevention programs. A similar position regarding use of tax funds for targeted public health purposes is taken by those urging increased levies on alcohol.

All that said, Transform, the English think tank dedicated to drug reform, makes a fundamental point in this regard. It acknowledges how resources from taxes on drugs can be linked to funding prevention, treatment, etc. However, it also makes a wise observation that policy makers must bear in mind: "Service provision should be determined by need and evidence of efficacy, not by the whims of tax revenue generation." True. But targeting tax funds, done properly, can both underscore the importance of and fund those very services.

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