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No Kidding: In Iowa, They're Taxing Illegal Drugs
    #1604052 - 06/03/03 09:42 AM (20 years, 8 months ago)


No Kidding: In Iowa, They're Taxing Illegal Drugs
Tuesday June 03, 2003 10:53am

Des Moines, Iowa (AP) - Caught with drugs? Better have a drug stamp.

Iowa law taxes all illegal drugs, from marijuana to cocaine. The state issues stamps, which vary in cost and color according to the drug, to be affixed to the drug to show the tax has been paid.

"It was such a horse of a different color when it first came out," said Renee Mulvey, spokeswoman for the Iowa Department of Revenue and Finance. "It was just so unusual to be selling stamps to tax illegal drugs, that we expected a lot of misunderstanding."

The stamps cost $5 a gram for marijuana, $750 per marijuana plant, $250 a gram for other drugs and $400 per 10 doses of drugs that come in tablet form, such as ecstasy. The minimum charge is $215.

Some may get a good chuckle out of the idea of drug users trotting down to the revenue department to buy a tax stamp, only seven batches of stamps have been sold (none were sold last year), but the state is making a small fortune off of those who get caught without them.

"We look at it as a way to tax the underground economy. Just because something is illegal doesn't mean it shouldn't be taxed," said Pete Bodyk, operations officer for the Kansas Division of Alcoholic Beverage Control, which collected about $1.3 million in drug stamp tax penalties and revenues for fiscal year 2002.

Since Iowa enacted its drug tax in 1990, the state has collected nearly $4 million total in penalties and tax revenues.

The drug stamp tax came about in the 1980s as the war on drugs was getting underway. In 1983, Arizona was the first state to enact a drug stamp tax, followed by at least 20 others, said Arturo Perez, a fiscal analyst for the National Conference of State Legislatures.

"It was viewed by those who champion and pass such measures that if you could further stiffen the penalties on drug dealers that you would, again, make it less enticing" to buy or sell drugs, Perez said.

In Iowa, failure to affix a drug stamp is punishable by up to five years in prison and a $7,500 fine, for those who aren't habitual offenders. The civil penalty is two times what the person would have paid to get a stamp; interest accrues at 7 percent a year from the day of assessment.

"We hear all kinds of comments, pro and con, with the drug tax. We view it as a job," said Mulvey, adding that stamp collectors have described the stamps as "homely." The stamps, twice the size of those used on regular mail, come in colors such as burgundy and mustard yellow.

Today, 23 states impose a drug stamp tax, but some have had to wrangle with the right of buyers not to incriminate themselves by buying a stamp.

In Iowa, it's anonymous.

"If someone came in and purchased and it was obvious that they were making a purchase to actually put on their drugs, drug containers, we would not" call authorities, which the law prohibits, Mulvey said. "People come in to make a purchase, we keep our mouths shut."

From July 2002 through March 2003, agency officials assessed $203,256 in penalties in 11 cases, about a third of the cases they investigated.

Generally, the agency only goes after defendants who have assets and are not in prison. Otherwise, the debt would be uncollectable, officials said.

One of those 11 cases involved a $119,000 assessment against former Des Moines Area Community College President David England, who pleaded guilty in April to possessing marijuana with intent to deliver and violating Iowa's tax-stamp law. England's wages will be garnisheed for payment, Mulvey said.

The state collected as much as $637,635 in taxes and penalties in fiscal year 1994, but the amount has declined since then. Collections were $241,696 last fiscal year.

At the same time, state narcotics agents continue to make bigger drug busts every year, such as the $6 million worth of cocaine found hidden in a car stopped along Interstate 80 last January.

So, could the state be collecting even more in revenues?

Not necessarily, Mulvey said. Budget cuts have hampered collection efforts, and those caught with a large cache of drugs might not be able to pay, she said.

"Because the street value is so high, does not mean the people have the money to pay the tax. After all, their drugs did not get sold," Mulvey said.

There also is some question about whether the agency would be able to collect from someone who was not a resident of Iowa.

"It's much more difficult to collect tax when the individual is out of state," Mulvey said.

Marijuana activist James Getman, who had about $30,000 in savings seized for failing to pay the drug tax, said he agrees with the slogan "no taxation without legalization."

He attended "The Greater Mississippi River Valley Tea Party" held in Rock Island, Ill., about 10 years ago to protest the tax.

"It was like the Boston tea party, we (were) rebelling against an unjust tax," said Getman, director of Iowa Norml, a nonprofit organization supporting the reform of marijuana laws.

However, Getman said, the group did not throw marijuana into the river in protest.


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Registered: 04/06/03
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Re: No Kidding: In Iowa, They're Taxing Illegal Drugs [Re: motaman]
    #1604506 - 06/03/03 12:21 PM (20 years, 8 months ago)

neat collectable

One of the reasons marijuana is illegal today because growers in the 30s lobbied against hemp farmers -- they saw it as competition, because It is not chemically addictive as is nicotine, alcohol, or caffeine.

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Registered: 04/27/01
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Re: No Kidding: In Iowa, They're Taxing Illegal Drugs [Re: Hans_Moleman]
    #1607498 - 06/04/03 09:57 AM (20 years, 8 months ago)

Wow!--that is a good one. Thanks for posting it! will wonders never cease....


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Registered: 10/27/98
Posts: 5,398
Loc: The Matrix
Re: No Kidding: In Iowa, They're Taxing Illegal Drugs [Re: motaman]
    #1607920 - 06/04/03 12:45 PM (20 years, 8 months ago)

Pardon my Francais....

Fucking hypocrites!!!


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