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Ganja gold

Govt sitting on $70 million in earnings, says economist

The Government of Barbados is spending a staggering $150 million annually on policing, 15 times as much as it makes in fines for trafficking and use of marijuana, according to a leading economist.

It is for this reason that President of the Barbados Economic Society Jeremy Stephen said he has adopted a pro-legalization position.

President of the Barbados Economic Society Jeremy Stephen

President of the Barbados Economic Society Jeremy Stephen

Making a strictly economic argument, Stephen today told a symposium on marijuana at the Cave Hill Campus of the University of the West Indies that due to the sharp disparity between income and expenditure, Government simply could not justify spending as much as it does trying to keep ganja off the streets in these tough economic times, while taking in so little in return.

“The entire cost to the Attorney General’s office, one is looking at $149 million per year. In other words, of all ministries it has the fourth most expenses. I did not draw out all of the numbers but this legal cost is ascribed to the condemnation of marijuana.

“Now let’s look at revenue that you make . . . . Overall the Attorney General’s office only gets $10 million in revenue; in other words roughly 1.5 per cent of the expenses are covered,” the university lecturer and financial analyst explained.

In providing a breakdown of the financial returns through the prosecution of marijuana-related offences, Stephen urged the authorities to do the math in order to determine if continued criminalization of the drug made economic sense.

“Where does this revenue come from? Forensic services for narcotics that are the fines paid, only accounts for $30,000 per year. Supreme Court fines [bring in] $750,000 per year, which is really not that much. So let’s look at this math. You are effectively saying that less than approximately one per cent of expenses for policing marijuana are covered by the fines,” he stressed.

Citing examples of taxes derived from other sectors, which many may categorize as immoral, Stephen argued that marijuana could also result in similar revenue intakes.

He said that based on the accepted premise by most legal pundits, for every shipment of marijuana intercepted by lawmen, ten get into the country and on the streets.

Stephen estimated that Barbados could earn close to
$70 million annually from taxes on the drug, enough, he said, to offset the cost of tertiary education.

While Jamaica decriminalized small amounts of marijuana last year and establish a licensing agency to regulate a lawful medical cannabis industry on the island, its economic contribution was not immediately clear.

The country’s Cannabis Licensing Authority announced in June this year that it would install marijuana-dispensing kiosks for tourists in order to regulate the growing drug market and to bring in more government revenue.

The dispensers would be situated at airports and seaports, manned by a person with medical training.

But perhaps the place where the impact of legalization is most visible is the US state of Colorado, where legal pot sales jumped by more than 42 per cent last year and sales of medical and recreational marijuana raked in US$996.2 million up from the $699 million earned in 2014, according to state’s Department of Revenue.

Colorado’s first pot stores officially opened on January 1, 2014, although medical marijuana has been legal there since 2000.

The Denver Post reported that Colorado collected more than $135 million in taxes and licence fees related to legal cannabis sales last year, up nearly 78 per cent from the $76 million in taxes and fees collected the previous year.

“The additional tax revenue far exceeds the cost of regulating the system,” the multinational business magazine Fortune quoted Mason Tvert, a spokesman for industry advocacy group the Marijuana Policy Project, as saying in a statement. “Regulating and taxing marijuana has been incredibly successful in Colorado, and it represents a model for other states to follow.”

Four US states and Washington D.C. have legalized recreational marijuana, while another 20 allow use of the drug for medicinal purposes.

ArcView Market Research, which produces a report on the state of the cannabis industry, has predicted that the legal cannabis market will grow by 25 per cent this year to reach US$6.7 billion in total sales, and that sales could approach US$22 billion by 2020.

colvillemounsey@barbadostoday.bb

7 Responses to Ganja gold

  1. Adrian Reid
    Adrian Reid September 23, 2016 at 12:50 am

    I all for legalizing marijuana and making money from it the Americans trick us some years back came in the Caribbean and stole some of the best varietiesand took it back and made the regional governments destroy the rest and now they have legalize marijuana and making mad money off of it and the big headed people who have the most power slow to legalize it now

    Reply
    • Michael Smart
      Michael Smart September 23, 2016 at 2:44 am

      So you decide to legalize it. Now what impact will it have on the current underground economy? One spin off is that the livelihood of so call drug lords will be affected ? How are you going to negate against that and stop them from introducing harder drugs such as heroine and crack cocaine on a much more large scale basis to make money?

      Reply
      • Omar Gill September 23, 2016 at 4:32 pm

        Just to be clear, your solution is to keep it illegal to give the drug lords something more productive to do?

        Reply
  2. Hal Austin September 23, 2016 at 4:03 am

    Decriminalise.

    Reply
  3. jrsmith September 23, 2016 at 5:36 am

    Look at the states in the (US) who has legalize cannabis and notice the white folk seems to be the ones planting and controlling the selling… please don’t have a go at me I saw this some time ago on a ( T v ) documentary in the UK…

    The scary thing about legalizing cannabis in Barbados is the involvement of our politicians they get involve and its mayhem…

    Reply
  4. Lennox hewitt September 23, 2016 at 7:43 am

    Ok say it become legal n bim does it mean dat men an wimen be all bout smoking weed ? N people lunch time it be week at weddings weed it become like ciggeret men all bout smoking police can’t stop dum long d legal amount on ya i may go town n come back high so dis wa wunna want ? Wunna got tunnel vision wunna only seeing infront wunna just remember now children gine buy weed widdum lunch money dum buy now it illegal wa gine happen wen it get legal only show ya i no well understand dat 2 people save all dum lunch money to buy blackberry a few years ago imagine wa gine happen f weed pass .

    Reply
  5. BoboTheClown September 23, 2016 at 8:16 am

    I could see all these Zombies stumbling about the city ,in the bus stand ,causing all kinds of problems because of intoxication. I think there would be and increase in accidents as a result,more altercations ,everything that would effect our daily lives. I must be believed that there would be more people smoking pot than drinking alcohol .And any combination of pot and Alcohol could be horrific . I guess there are those who believe that pot smoking is a right .Unlike cigarettes , pot alters ones’ way of thinking, which in many or most cases also result in one ability to act or think in a coherent manner.
    I do believe if legalized those of us who are still alive years from now will regret it dearly ,and our children and they children will have to live in a world even more dangerous and unpredictable than we are currently living in.

    Reply

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