• BREAKING NEWS ABC shows live and on-demand -- Download the WATCH ABC app!

Pro-pot forces point to increased tax revenues

March 25, 2010 12:00:00 AM PDT
Will the state see a financial windfall if marijuana is legalized? Supporters of the ballot measure are promoting a marijuana tax. But some critics say they're just "blowing smoke."California voters will decide in November whether to legalize marijuana. People are already debating whether it would bring in much-needed money for the state.

Supporters of legalizing marijuana for recreational use have been pointing out the financial benefits for state and local governments.

While the initiative doesn't spell out how much they could earn, it leaves the door open to taxing the drug.

State Assemblyman Tom Ammiano had been championing a similar proposal through the Legislature.

"Excise tax and sales tax. And the estimate from that is $1.5 billion," said Ammiano.

In these tight budgetary times, the money is tempting. Supporters say decriminalizing pot would save tens of millions of dollars in prison and law-enforcement costs. And new taxes would help California's deficit-plagued finances.

"All those programs to teach kids about drugs, to demystify it, why it's bad, et cetera, all those have been cut," said Ammiano. "So then we can replenish those programs because they are effective."

But law enforcement says the social ills outweigh the money gained.

"We already have significant problems with alcohol. We have significant problems with pharmaceuticals. We tax them both, but in fact the cost to our society is much greater than the revenue we bring in," said John Lovell, a lobbyist for the California Police Chiefs Association.

If the marijuana initiative passes, the other problem is it conflicts with federal law, which would still treat marijuana possession as a crime.

"It doesn't make California citizens immune from the application of the federal law. They could still get arrested and prosecuted," said Prof. Leslie Jacobs, University of the Pacific, McGeorge School of Law.

For 15 states like California that allow for medical marijuana, U.S. Attorney General Eric Holder announced last fall that raiding dispensaries would be a low priority. There's no guarantee, though, the same policy would apply under legalized recreational use.

The marijuana initiative will probably be one of the most watched campaigns this November because there's a national debate over whether it's time to soften drug laws.