Legalizing Marijuana It Costs Significant Money for Essay

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Legalizing Marijuana

It costs significant money for governments to catch buyers and dealers of drugs in the black market, arrest them, file cases against them, and then keep them in jail. Hence, the war on drugs is a long, risky, expensive undertaking. (Boylstein, 2003) This spending is considerably high when talking about the drug marijuana, as it is one amongst largely consumed drugs as it does not cause much harm to health like tobacco or nicotine. Hence, the government was at a loss due to spending a lot of revenues on war on drugs and by not collecting taxes for the illegal drugs. According to the research, a lot of tax revenue can be collected by the governments by legalizing marijuana.

In old times, Americans considered marijuana, as an impecunious type of tobacco. Actually, its name marijuana was suggested by Mexicans, they considered marijuana as the lowest variety of cigarette. When these Mexican laborers mingled with other underprivileged farm laborers, some of them started to use marijuana as a recreational drink. In the beginning, it was only practiced by the poorest populations of the community and then it started to spread gradually. And currently, it has been calculated that its sellers earn as much as $6.90 for a unit of Marijuana as normal price of half a gram marijuana is $8.60 on the street, whereas its production cost is just $1.70. However, it has been estimated that this difference of prices would soon be diminished for the reason that, Entrepreneurs knowing the huge profits to be made through selling marijuana may establish their own cultivating operations, that will lead to a rise in its circulation on the streets, that will eventually cause its street price to drop to a price more or less similar to its cost of production. (Stingl, 2012) Obviously, it is not possible where the drug is still illegal and the fear of punishment discourage a lot of entrepreneurs and time to time drug bust keeps its supply reasonably low. It can be said that greater part of this $6.90 per unit of marijuana profit is utilized by the underground economy that is creating large number of criminals, many of them are also associated with organized crime as majority of them are very resourceful.

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Alternatively, if government legalize utilization of marijuana cigarettes, it will start to earn a tax revenue on marijuana cigarettes, which is nothing less than the difference between the cost of local production of marijuana and its street price that large number of citizens are already paying at the moment. It will shift the income from the existing producers of the drug and its dealers (large number of those are associated with organized crime) to the local government. According to an estimate, by doing so the government may earn as much as $7 per unit of marijuana, exclusive of its marketing or transportation charges. Hence, by making revenue on sale of every cigarette the government would increase its earnings as much as over $2 billion, excluding the cost of its transportation, promotion, and advertising, which is much greater than a government earns from an export tax.

Hence, an increased revenues connected to legalization and taxation of marijuana is of great importance to the government. According to the Board of Equalization $1.4 billion prospective returns for the country is based on a sequence of assumptions that are in some cases subject to remarkable vagueness and in other cases not authenticated. The postulation that the market can uphold a $50/ounce tax is a greatly dubious one since such a tax does not eradicate the income motivation for black market dealers to leave the market. An approximate size of the marijuana market in CA, creates a best approximation of marijuana utilization in California of 13.8 million ounces (which is less than the 16 million ounces calculated by the California Board of Equalization), but due to the doubt in our assumption underlying this guess, the exact magnitude of the marijuana market is expected to be some where between….....

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