Legal cannabis tax could be worth £1bn

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A ‘root and branch’ reform of UK cannabis policy is ‘long overdue’, says a new report from Volteface and free market think tank the Adam Smith Institute. A legal cannabis market in the UK could be worth £6.8bn a year and produce annual benefits to the government of up to around £1bn in tax revenue and reduced criminal justice costs, says The tide effect: how the world is changing its mind on cannabis legalisation.

Current policy is a ‘messy patchwork’, it says, with enforcement intermittent and dependent on each regional police force. The government ‘must acknowledge’ that legalisation is the only workable solution, the document states.

The report, which has the backing of cross-party MPs including Caroline Lucas, Nick Clegg, Paul Flynn, Peter Lilley and Michael Fabricant, comes after four more US states, including California, have voted to legalise the sale and consumption of recreational cannabis (see story this page). A regulation model is ‘substantially more desirable’ than either decriminalisation or unregulated legalisation as it is the only way to ensure that the product meets acceptable standards of quality and purity, it says, as well as removing criminal gangs from the equation ‘as far as possible’, raising revenue for the Treasury through point-of-sale taxation and protecting public health.

The document also echoes previous calls for the responsibility for cannabis policy to be moved to the Department of Health, with the Home Office’s role changing from ‘enforcement of prohibition to enforcement of regulation and licensing’. Jailing people for cannabis-related offences in England and Wales costs around £50m per year, the document adds.

‘The global movement towards legalisation, regulation and taxation of cannabis is now inexorable,’ said Volteface’s director, Steve Moore.

‘Today in the UK there is capricious policing of cannabis and no regulation of its sales and distribution. This quasi-decriminalisation of cannabis leaves criminals running a multi-billion dollar racket and exposes teenage kids to criminality. The evidence is now clear that regulated markets for cannabis cut crime and protect vulnerable children. The government’s current policy vacuum is untenable in the face of this evidence.’

Report available at www.adamsmith.orgimg_5519