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L.A. City Council to put pot tax on ballot

November 16, 2010 12:00:00 AM PST
The Los Angeles City Council decided Tuesday to put what is essentially a medical marijuana tax before voters on the next ballot. Taxing medicinal marijuana dispensaries could make millions of dollars in revenues for local governments but questions persist over whether or not it is legal. So rather than calling it a tax, the council is calling it gross reimbursement.

Because selling pot is illegal under federal law the medical marijuana dispensaries are classified as collectives. The users contribute a share for operation to get their pot. Thus a tax-like surcharge would be gross reimbursement.

There was little debate when the issue came before City Council. Janice Hahn pointed out that the city attorney specifically drafted the medical marijuana ordinance to allow such "taxes" to reimburse for the costs of running the collectives.

Councilman Paul Koretz said they had nothing to lose. "This is the only significant revenue drawing item on our ballot, which was originally intended to have several of them. I think we are in desperate need and shouldn't miss this opportunity."

Sacramento voters decided to add such a tax to their dispensaries. The vote was 10-4 in the L.A. City Council to put the measure on the ballot in L.A.

Tom LaBonge was the only dissenting voice, questioning whether the paraphernalia sold in the shops would also be taxed.

The city attorney pointed out that those items are already covered under state sales tax.

The gross reimbursement charge will be on the March ballot. If it passes it will be used to pay for public safety and fire departments.


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