I recently read that MS is putting a tax on illegal drugs. I read TN has had this tax for a year and at least 8 other states do it.

The way I read it is drug dealers, before selling the illegal drugs are suppose to go to the IRS and buy tax stamps to place on the illegal drugs they are selling. I guess this allows them to prosecute on tax evasion and confiscate property.

I don't know how it works if you are caught with a small amount.

Check this page out- it's hard to believe and definately worth the read!!

http://www.state.tn.us/revenue/misc/unauthsubfaq.htm#unauth1

IA.'s had the drug stamp tax for a quite a while. It's bogus, you'll NEVER get anything from the IRS other than busted and...and!! It's just a way for them to add more to your fines. That's all it is. Just away for the state to hit you up for more cash.

If anyone is stupied enough to do that then they deserve to be caught. WHY would anyone go and pay taxes on an ILLEGAL drug????? HELLO, just move right on into the cell while your there!

If anyone is stupied enough to do that then they deserve to be caught. WHY would anyone go and pay taxes on an ILLEGAL drug????? HELLO, just move right on into the cell while your there!


Theysay you don't have to bring the drugs to the IRS office, I don't think you have to even tell them your name. You just go in and purchase however many drug stamps you need for the taxes.
Then you to stick these stamps on each baggie of pot or whatever you are selling to prove you paid taxes on it. I seriously doubt anyone had ever done it.

Another thing you can find online is government auctions where they are selling homes, cars, household items, art, jewelry etc. they confiscated from drug busts.

Well this is so very interesting and so very funny. Ive read of various places having this tax and its such a joke.
If anyone has ever seen one of these stamps actually on drugs, could you post here. Also, I would be very interested to know if anyone has any information that might be available as to how many of these stamps have been sold. They must have to state this somewhere as a source of tax collected from drug stamps. This all reminds me of that show, it was called the worlds stupidest criminals,,or something like that. I quite sure that even if they dont take your name, they still have security cameras in the building and if you purchase these stamps you are basically saying you are doing something illegal or purchasing them for someone who is doing something illegal. What a waste of a law. Did they make this law so that the tax payers think that the government is winning the drug war ?

Did they make this law so that the tax payers think that the government is winning the drug war ?


It is to stupid (and funny) to be true but IT'S TRUE !

The closest thing I have ever heard to it was a woman who was drinking and driving that pulled into the police station. She wanted to take a breath test to see just where her blood alcohol level was!

I think this law is just a way to get more money from a drug bust.

I guess it takes all kinds of people to make the world go around. If someone indeed was dealing in illegal drugs and even attempted to go and purchase these stamps, the fact still remains the drugs are still illegal. The stamps do not make them legal. I can just see the security cameras and the police following them to their homes and voila arrest warrant in hand, they already have probable cause because they just bought the stamps.

The government needs to come up with a solution better than this one to fight the drug war. All this will do is to put more money in their hands. So, perhaps with the money they can buy fancier equipment and indeed fight the drug war by more arrests. Who knows! Just my thoughts.

I wonder how much it costs them to set up the whole stamp program vs the cost of opening another rehab.

I just finished watching a film that had been on the history channel a while back about how pot became illegal (Hooked - Illegal Drugs and How They Got That Way). I was very amazed to find out that the drug tax stamps became law before pot became illegal federally. Though the article below states they started in the 80's and 90's it is referring to the stamps not the law. The federal drug tax law has been in existance prior to that by decades. So the drug stamp law has been around a long while now . At the time they had no intentions of producing the stamps but just passing the law as a means to control drugs. So this new sudden interest in this by various states is actually not a new law but a rebirth of an old one. Here is an article that is very enlightening as far as how effective these stamps actually are these days as well as their uses.


Marijuana Tax Stamps No Hit With Dealers
The Post and Courier; March 13, 2005
by Schuyler Kropf

Officials Say Collectors, Not Sellers, Are Only Ones Buying Pot Stamps

As the leader of Charleston's pro-marijuana lobby, Berkeley County resident Roman Prince calls the state law requiring pot dealers to buy tax stamps "a sucker's bet."

"More people are going to get busted" if they stand in line to identify themselves as sellers, he said. How wrong Prince is.

Ten years after it went on the books, a little-known law requiring marijuana dealers to pay taxes up front on pot sales has had an impact as fleeting as, well, a puff of smoke.

As far as state officials can tell, not a single dealer has purchased the required stamps. Instead, the stamps have created a market and a demand among collectors who've been scooping them up for display.

"I have South Carolina's current stamps and a copy of their original," said Milwaukee, Wis., defense attorney Robert Henak, who collects state drug stamps from around the country as a hobby to point out what he called the absurdity of drug tax laws.

Henak isn't alone. Of the 433 pot stamps sold by the state since 1994, the overwhelming majority were bought as novelties and nothing more, according to the South Carolina Department of Revenue. Today, drug tax stamps are more likely to be seen at trade shows than on a dime bag.

"Some are scarce as hen's teeth, others you can find all the time," said Scott Troutman, secretary of the State Revenue Society, a nationally focused collector's group dedicated to the preservation of state tax stamps from all of U.S. history.

As envisioned by the South Carolina Legislature, the stamps were to be required for every gram of illegal drugs sold by a dealer in the state. They are similar to the stamps affixed to other vices taxed by the state, such as liquor and cigarettes.

The schedule requires a $3.50 sticker for every gram of marijuana, which is the most popular among collectors. The current South Carolina marijuana stamps shows a pot leaf imposed over an image of the state with a circle and red stripe superimposed, the universal "no" symbol. It is currently for sale at the Department of Revenue office in Columbia.

For other drugs, the tax requires a $200 sticker for every gram of a controlled substance, such as cocaine, and $2,000 for a 50-unit dose of a controlled substance that's not sold by weight, such as pills. Not a single one of those has been bought.

A drug dealer who violates the stamp law is subject to a fine of 100 percent of the tax, in addition to possible jail time.

As many as 18 other states have similar laws on the books. They were adopted in the 1980s and '90s as legislators sought more tools to prosecute drug traffickers as tax cheats.

At the time South Carolina's law was passed, no one seriously thought drug kingpins or corner dealers would line up to buy them. But from the outset, South Carolina's tax stamp law has been of little value to enforcement agents.

Because of constitutional concerns over self-incrimination, people who buy the stamps aren't required to give their names, addresses or any other personal data, leaving no way for the state or law enforcement to track where they go.

Additionally, the state Department of Revenue, which produces and enforces the stamps, has profited little from them. There is no mandate for arresting police agencies to contact the revenue department or to include them in a prosecution. When drug dealer assets are divvied up after a successful prosecution, most of the money recovered goes first to local, state and federal law enforcement agencies. The revenue department usually is last.

In the 10 years the law has been active, the department has received $115,988 from the stamp program, a fraction of the millions of dollars in drugs seized in the last decade. The money was collected mostly in the rare instance when revenue staffers are called in by local police to perform audits.

"There's really no incentive for local law enforcement officials to refer a case to us," said spokesman Danny Brazell. "We do get a few referrals and that's how we've obtained the little bit of money we've gotten from the illegal drug industry in South Carolina."

The one legal challenge against the state's drug stamp went to the South Carolina Supreme Court in 1995. Drug dealer Demetric S. McMullin protested the $105,000 tax bill from the revenue department he received for the 220 grams of cocaine and crack cocaine in his possession when he was arrested. None of it was stamped.

McMullin argued the stamp act was unconstitutional because the state had already imposed a criminal penalty on him for the cocaine charge. The high court disagreed on grounds that charging a tax on drugs doesn't equate to a form of punishment.

It doesn't surprise University of South Carolina criminologist Geoff Alpert that South Carolina's drug stamp law is seldom enforced. He said authorities already have plenty of tools to prosecute drug cases.

"The people who sell a lot of marijuana aren't going to be the ones standing in line paying their taxes," he added.

Alpert sees a dealer's market for the stamps, but not on the streets.

"If I had any, I'd be putting them up on e-Bay," he said.

MARIJUANA AND CONTROLLED SUBSTANCE TAX ACT

- -- Dealers are not required to give their name, address, Social Security number or other identifying information on the form.

- -- A dealer who violates the stamp law must pay a penalty of 100 percent of the tax, in addition to the tax required. Additional penalties include up to five years of prison time and a fine of up to $10,000.

- -- The stamps are to be affixed to every parcel of drugs sold but can be used only once.

(c) 2005 Evening Post Publishing Co.

I don't know about winning the "war on drugs"......but this is a strange post.......my daughter and i just had this discussion ......the federal tax law states you must pay taxes even if the activity is illegal.......she wondered how they would pay taxes without getting busted for the illegal activity.....i told her what my opinion on all of this is.......when someone gets busted for drugs, prostitution, what not.......the IRS can step in (and often do) with tax evasion.......tacking on yet another set of charges and MORE time and money.............go figure

I was just thinking they would be clever office gifts at Christmas. When they put a $10 ceiling on an office Christmas present these $3.50 stamps would definately be a hit.

This is interesting:

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

from june 2, 2003 -
http://www.cannabisnews.com/news/thread16503.shtml

Tennessee started the program in Jan 05 and by March had collected over $100,000.00 from illegal drug taxes

By 2004 NC had been using program since 1990 and collected $73.9 million

In 2004 the state of Utah collected $130.00..lol

I've heard people say taxes are to high to buy a house, I've never heard them say taxes are to high to sell drugs..but it may happen!

ROFL..I just had this mental image of Cheech N Chong going into the IRS office stoned to pay their drug taxes.

when someone gets busted for drugs, prostitution, what not.......the IRS can step in (and often do) with tax evasion.......tacking on yet another set of charges and MORE time and money.............go figure

We came thisclose to that happening. Due to my husbands accident, then drug dealing, & going to fed prison and all, I got several years behind in filing our returns. The IRS came down on us last year. Thankfully, my tax lawyer mentioned that I had to show my husband's drug dealing income! The accountant didn't think of it. I was like, "How do I come up with a figure?" For one thing, there was no income. My husband was the worst drug dealer that ever walked, but you can't count the times that you were not paid, shorted, or stolen from as losses!! Another thing, drug dealers don't keep written records of transactions!!! I had no idea how much dope he'd bought or sold & neither did he! And unlike a legit business, you do not get to count the expenses as write offs:D My husband was buying the crap in a different state. Unfortunately, mileage, gas, hotel bills, phone bills are not deductible.

I finally just used the amount that he was indicted for and figured out what the income would've been. God help me if they ever ask for paperwork!!!!

Here's some sites on govt seized property..

http://www.treas.gov/auctions/customs/

http://www.usmarshals.gov/assets/index.html


Makes you wonder how much income the government would lose if they
really did keep drugs out of the country!

"Thankfully, my tax lawyer mentioned that I had to show my husband's drug dealing income!" I am not making fun, nor am I laughing at your situation by any means, but that has got to be the craziest sentence I have ever heard!
How messed up is this country???

"Thankfully, my tax lawyer mentioned that I had to show my husband's drug dealing income!" I am not making fun, nor am I laughing at your situation by any means, but that has got to be the craziest sentence I have ever heard!
How messed up is this country???



Jeni,

What state was it? Did they fine him for not paying tax on illegal drugs?
(it's crazy to even be asking such a question).

yep. someone in my family had pot, a lot of it. they got off of the big charges cos of an illegal search and seizure and hit him with posession... the stamp in his case is a lein pending in a court case they keep open cos they couldn't get the big charges to stick .now they are trying him now as a party to a crime with a different pot case (his brother had some in the car- he didn't know) and if they get him this time, they got 70k pending in another case that's over ten years old. it's sad.

my thing is: how can they tax illegal activities? it's laughable. til you're caught.

Jeni,

What state was it? Did they fine him for not paying tax on illegal drugs?
(it's crazy to even be asking such a question).

Demi,

Jeni was responding to a post I'd written. We live in Texas. We included the illegal income in our tax return, the figure I came up with was something like $30,000 on top of our regular income. We have to pay late penalty fees and interest due to filing the return late.

You ask "Did they fine him for not paying tax on illegal drugs?" The answer is no, because we did pay taxes on it. However, if we hadn't have, they wouldn't have just issued a fine. He could've been charged with filing a fraudulent tax return or tax evasion. When you combine illegal drug activity, the IRS and the Federal Government (my husband is in the fed pen)....you never walk away with just a fine ;)

my thing is: how can they tax illegal activities? it's laughable. til you're caught.

Of course no one is going to report illegal income unless you've been caught. But if you've been caught & don't want to face more charges, best to be on the safe side!

Of course no one is going to report illegal income unless you've been caught. But if you've been caught & don't want to face more charges, best to be on the safe side!

That is amazing. I imagine you walked around thinking "this can't be real!" It seems you had a good lawyer. Here's hoping that when he gets out he can do something as financially rewarding as drug dealing. And, if it isn't Money really isn't everything.

Good Luck to you and thanks for your reply.

Well, I've been walking around for the last 3 years thinkin "this can't be real" ever since he got busted lol. As far as financially, we were doing great. We have a very profitable I run by myself now. It's only by the grace of God that they (the feds) didn't take that because we were looking at up to an $8 million dollar fine with his drug charge :eek: Anyway, at least he had the "smarts" not to destroy our business. He turned to dealing to support his habit :rolleyes: instead of bankrupting our company! Live and learn, sometime the hard way.

Kim

"It's only by the grace of God that they (the feds) didn't take that because we were looking at up to an $8 million dollar fine with his drug charge ."

------------

Wow! What is your take on this "drug war" ? Seems it is more profitable for our government to let the drugs come in.

Ive been looking up how much they actually profit on these taxes and it is not all that much though I expected more. Im putting together some information on that and I will post it soon.
Something I found interesting too is that the stamps expire after 3 months of purchase.
I really wonder often why the government makes the decisions they do regarding the 'War On Drugs'. Some of it makes no sense which leads me to also wonder what is in it for them. Also recently I read that war is good for a country economically, creates jobs, etc etc. I wonder if this is the case with the 'Drug War' in any way?

My experience is only with the federal prisons. Prisons are have great job opportunities for towns. They employ a lot of people and the towns get cheap labor. A couple of federal prison camps are slated to close. The towns arent happy about this, they are now going to have to hire "regular" people & pay normal rates. The BOP charges them less than normal and & make money by paying the inmates pennies on a dollar. All the C.O's and such are now either relocating or losing there jobs. So yes, I think the "War on Drugs" is a booming business. For people who build the prisons, provide services to (linens, food service, plumbing, etc.) to all the CO's & staff employeed, etc.

Think of this, the feds have around 183,000 inmates. Estimate that these inmates have an average of $200 on their books, that's $36,600,000 that the feds are drawing interest on.

Think of the money that they make off of seizing cars, homes, boats, bank accounts, motorcycles, vacation homes, etc!!! Our banker warned us the FBI was looking into our bank accounts, investigating if they could conviscate anything that they thought was bought with "drug money" (RICO act). Like I said before, there wasn't any income from his drug dealing. All of our posessions were bought before this nightmare.

We weren't fined the $8 million fine, that was the maximum. In fact, the judge that we had didn't fine my husband. Maybe he thought taking him away for 16 yrs was enough. Our son was 6 & starting school when his daddy went away, he'll be 20 & gone when he gets home. My husband got a mandatory 10 yrs for a nonviolent drug offense. LOL, then they tacked on 6 more for understated criminal history!!! That was for a 1/2 gram that he'd been charged with almost 15 yrs before this all happened.

"War on Drugs" my a$$, it's a war on people and we are the ones paying the price while the government gets richer and richer.

I agree with both of you. Witchlinblue I learned years ago in a college class that our economy has always done better during War time. And I hate to say it but I'm afraid your research will show drugs pour money into our economy.

HanginOn, was your husband sentenced under the old guidelines that Judges had to follow? I'm just wondering if it could be reduced?

Demi- I quoted that from "Hangin On'- so I don't know.
It just amazes me-
If the freaking gov't understood even HALF of what it was like to be addicted, or live with an addict- if they could have compassion for one second! (Well, they do when it comes to one of their own....)
Addiction is not a crime- the gov't using it to make money is.

Just for interest sake, I spotted this on the net this morning (Ive left out his name)
(name), 24, of Pittsburg, was booked in at 3:33 a.m. for protective custody, two counts of possession of marijuana, possession of drug paraphernalia, felony possession of drug paraphernalia, no drug tax stamp, battery - domestic violence, possession of opiates or narcotics.

HanginOn, was your husband sentenced under the old guidelines that Judges had to follow? I'm just wondering if it could be reduced?

He was sentenced in 2003. Blakely/Booker/FanFan did not help him and thousands like him. He had a plea agreement and he had to waive his right to appeal his sentence. So, there's nothing we can do but try to get parole back in the federal system.

There will never be an end to drugs. It is too big of a moneymaker for our government.