By Kevin Kelley
Considering a comparable industry, taxation on cigarette consumption is a good place to look when considering the benefits of legalization of marijuana for the purpose of creating a tax base for funding universal healthcare. Currently, both the federal and state governments impose a tax on cigarettes, with income from cigarettes adding up to a significant amount for some states.
Although there have been increased legislation against cigarettes, with income derived from taxation decreasing steadily since 2002, with the federal cigarette tax collecting only $7.7 billion in 2005, compared to $8.1 billion in 2002, this is still a considerable amount. The individual states have also seen monetary gains. California earns about $1 billion a year, while Minnesota earns roughly half that. Just using these figures as a comparison, and using the proposed bill by Senator Max Baucus, the income generated at the federal level for the taxation of cigarettes constitutes almost ten percent of the total estimated cost of health reform, according to the Congressional Budget Office. Estimates for the legalization of marijuana has placed the figure around this level to even higher, with such a disparity due to the fact that it is difficult to gauge illegal consumption. Potentially, marijuana could offer far greater tax benefits that the government could use for funding universal health.
Here is a map depicting various state taxes on cigarettes (click to enlarge):
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