Los Angeles Voters Pass Additional Tax On Medical Marijuana

By Allen Starbury  |  03/09/2011

Marijuana leavesLos Angeles voters turned out at the polls on Tuesday (March 8) to cast their votes on a number or measures, one specifically was a medical marijuana tax.

Voters seemed to be in favor of the measure early on, passing with a 59% voting percentage ... and has since passed, said reports.

Dubbed Proposition M, the medical marijuana tax measure will slap a 5% tax on the gross receipts from sales at the city's medical marijuana dispensaries.

That percentage is nearly ten times higher than the current percentage of 0.59, meaning dispensaries will be charged $50 for every $1,000 earned in gross receipts, said High Times.

The measure was passed with the intent of generating around $10 million per year to help bail out Los Angeles' huge budget shortfall.

High Times says that the city of Oakland passed a similar measure in 2009, adding an initial tax rate of around $18 per $1,000 of sales, but the city has since raised it to five percent as well.

The estimated $10 million/year in tax revenue would go into the city's general fund.

While voters seem to be for the tax increase, opponents argue that medical marijuana users are already struggling to pay for the drug and some city leaders are concerned the tax could be illegal and may end up in the courts.

The medi-pot community in Los Angeles seem to be divided over the tax.

Long-time dispensary operator Yamileth Bolanos told the Los Angeles Times: "The city has done nothing for the patients, and I don't see why the patients have to pay a sin tax. We're not a topless bar."

Others are in favor of it, because of the long-term effect it could have on marijuana acceptance in the mainstream.

The L.A. Times was also against the measure, arguing that support of it could result in drawbacks in the future.

"Getting in bed with a quasi-legal industry has drawbacks. If city government became reliant on tax revenue from medical marijuana sellers, city officials would be less likely to pass ordinances restricting their operations and police would be less inclined to raid their establishments to check whether they're really running on a nonprofit basis. A decrease in such scrutiny would encourage more illegal for-profit dispensaries, which draw other kinds of crime."

However, L.A. sales tax is already 9.75%, so the increase puts the tax at nearly 15% to the patients.

What do guys, outside of Los Angeles, think? Is the tax good or bad? Sound off.