Pat Oglesby ISSDP Rome2014
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Transcript of Pat Oglesby ISSDP Rome2014
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
Pat Oglesby ISSDP Rome2014www.newrevenue.org
Revenue from Cannabis
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3 Big Questions
• Tax: Whether: Yes or No?• If Yes:– How much? – How? Measure $ (€, £, ¥)? Gm? THC?
Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
Whether?• Non-commercial alternatives: pages 12-13 • Monopoly alternative: pp. 3-5– Liquor monopolies – Reversible– Nimble pricing– Limits profit motive
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
611 respondents, March 7-10, 2013, Public Policy Polling
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
¡Uruguay, Si! ¡Taxes, No!?
• But U.S. Federal law prevents state monopoly• Anyway, assuming tax model: How much?– A story
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
How much tax?
• (Pre-tax Prices )
• Post-tax price:– Not too high– Not too low
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Tax as % of final price
• Cigarettes in Europe: 70% and more• Marijuana in Washington ≈ 35% to 40%• Marijuana in Colorado ≈ 20%• Showing those % numbers: 2 next slides at
www.newrevenue.org show rough relationship by assuming, rightly or wrongly:– Certain markups – $20 price per unit (1/8 oz.?) at wholesale– $40 price per unit at retail
Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
Washington
Pre-tax Rate Tax After-tax
Producer $10 25% $2.5 $12.5
Wholesaler $20 25% $5 $25
Retailer $40 25% $10 $50
$17.5
Tax = $17.5/$50 = 35%
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
Colorado
Pre-tax Rate Tax After-tax
Wholesaler $20 15% $3 $23
Retailer $40 12.9% $5.16 $45.16
$8.16
Tax = $8.16/$45.16 = 18%
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
884 respondents, March 6-9, 2014, Public Policy Polling
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
Tax breaks: Medical and homegrown?• Colorado: 64% of market still medical, ≈
tax-free
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
What to tax?
• Potency: p. 6-7• (Price)• (Weight)
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
Price Tax Base: Problems • Bundling: p. 9 at bottom• Vertical Integration: p. 10 at n. 38• Price base amplifies problem of price drop
Tax rate 100%$5/gram 100%$5/gramPre-tax price $5 $5 $1 $1Tax $5 $5 $1 $5After-tax price $10 $10 $2 $6
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
Weight: P. 7-8
– Incentive for potent marijuana – So . . . new ideas:• Bud vs. Trim: CO now: 62¢/gm vs. 10¢/gm• Dry vs. Concentrated: NY proposed: $1.76 vs. $7.05/gm
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
Other Questions: P. 11
• Where to collect? Early in supply chain• Environmental friendliness?• Small business?
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Ace in the Game Pat Oglesby www.newrevenue.org ISSDP Rome
Revenue: For Gangs, Ganjapreneurs, or Government?
• Surprises are coming. Nimbleness is needed.
• More at www.newrevenue.org.• Suggestions to [email protected]. Thank you.