Monday, December 15, 2008

How Much Would Legalizing Marijuana Reduce the Federal Deficit?

ANSWER: Not Much

Although legalized marijuana would provide an additional "sin tax" revenue stream, along with tobacco and alcohol, the estimated $27.9 billion collected in 2010 ($11,030 million from alcohol, $10,700 million from tobacco and an estimated $6,200 million from marijuana) would be less than 1% of the projected federal receipts of $2,931,348 million that year. But, then, every little bit helps! For more info see the GAO 2009 budget.

HISTORY - It was during World War II (1939-1945) that then President Franklin D. Roosevelt made tobacco a protected crop after America's consumption of tobacco rose 2 1/2 times between 1930 and 1940. Roosevelt had already overseen the repeal of the 18th amendment in 1933, which had outlawed alcohol in 1919. The $1.2 billion in revenue from "sin" taxes in 1940 rose to $3.7 billion in 1947 and helped move the country towards a post-war budget surplus after running at a deficit from 1934 through 1946. But as a % of all federal receipts, excise taxes on alcohol and tobacco has declined each decade from a high point in 1940, when alcohol and tobacco excise taxes exceeded the individual income tax by 5%, to 1% or less from 1990 through a projected 2010.

TOBACCO - Tobacco is estimated to kill 440,000 annually in the U.S. and 2.1 million worldwide. It causes 30% of all cancers and is the primary cause of the rise in cancer death rates around the world.

ALCOHOL - According to the CDC, alcohol was responsible for 21,634 alcohol-induced deaths in the U.S. in 2005. If not used in excess, however (no more than 8 ounces daily), alcohol has been proven to be good for you.

MARIJUANA - Weed accounts for 0 to 2 annual deaths in the U.S. This does not count the possible deaths from smoking-related causes or from driving stoned. Because it is illegal, there is no excise tax revenue and the cost of policing it is high. According to a recent report cited on About.Com, the U.S. spends about $7.7 billion per year in state and federal enforcement expenses and loses another $6.2 billion in potential excise tax revenue on marijuana. As with alcohol, there are many documented benefits from the safe use of marijuana. Sphere: Related Content

2 comments:

matt mernagh said...

thanks for the information. every little bit does count. especially when your going broke. a little legal weed will help you sleep without the nasty hangover in the morning.

sarah said...

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Sarah

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