Sunday, July 19, 2009

Legal Marijuana in Alabama = $130,000,000

NOTE: I've revised my figures from the original posting. In the updated figures I used census data from 2006. The earlier number was from 2002 data. is carrying the story about how much money California would make if they go through with legalizing and taxing marijuana for adult use. The California estimate given by their Board of Equalization is $1.4 BILLION dollars.

That's a bunch of cash. That got me wondering about how much money Alabama would rake in if we legalized and taxed the sale of marijuana to adults at the same rate California plans to. Here is what the numbers look like.

The number of +18 marijuana smokers in Alabama is estimated to be 392,032 or 11.25% of the voting age population. That number is obtained by looking at the SAMSHA chart on substance use in Alabama in the past month and multiplying 11.25% times the voting age population of Alabama as of 2006 which is 3,484,729.

Next we look at the SAMSHA chart for California and see that 16.97% of +18 age group used marijuana in the past month. We multiply that by California's voting age population which is 24,650,185 and get 4,183,136.

Next we divide

Current marijuana users in AL (392,032) divided by current CA users (4,183,136).

This gives 9.3 percent of CA's marijuana using population.

0.093 x $1.4 billion = $130 million (and change).

That is not counting the money that would be made by putting Alabama farmers back to work or cottage industry grows that would spring up across the state, or the money that would be generated in new business that cater to the marijuana industry like pipe shops/smoking accessories, munchie outlets, places to congregate and smoke (think vapor/smoke bars) an increase in fertilizer and other farm equipment sales, marketing, packaging. Not to mention the hundreds of millions of dollars we would save in enforcement costs, incarceration, courts, etc..etc

I'd like to be able to crunch the numbers on how much Alabama spends on enforcement costs but those aren't available. The ALDOC doesn't break down inmates convicted of drug offenses by drug. I hear the Sentencing Commission has those numbers but they won't come off them. We know that 30% of all Alabama inmates are incarcerated for drug offenses. If all of those were for marijuana we would save $117,000,000 on top of the $130,000,000 we'd make by legalizing it for adult use.

However, we do know the number of Alabamians arrested statewide for marijuana for the year 2002. That number is 10,272. That is only 2.6% of the total number of estimated marijuana consumers in Alabama. All those millions and millions of dollars pumped into arresting marijuana users and the cops can't even make a dent in it. 2.6% is not even a drop in the bucket.

The war on marijuana consumers is a SHAM! Let's end it.


sixstring said...

Have you been taking math classes?

Loretta Nall said...

Heh...yep and now I know what I will be using all that math for.

Buy Weed Onlin said...

It's already here folks. The legislators are just slow to catch up. I can get my hands on some nice weed right now online. THe genie is out of the bottle.

Evan said...

I'm against the heavy taxation of marijuana as suggested. High taxes, like sin taxes put on alcohol & cigarettes, will stunt the growth of this industry. It's sad that we have to use the promise of tax revenues as a way to bribe legislators into considering legalization. The moral argument seems to have no effect, but then when money is brought up they suddenly listen.

I would argue that no taxes (or licenses) on growing and selling cannabis/hemp would increase tax revenues more than direct taxation. I say this because as the cannabis/hemp industry exits the black market & enters the business world it will increase sales in all kinds of other industries, some of which you mentioned in your post.

Instead of narrowly focusing on the direct taxation of this resource, it should be seen for what it is, one of the greatest natural resources available to mankind. If Alabama's government had any sense, they would immediately legalize growth & sale of cannabis/hemp with no direct taxation so that we can be some of the first to build this local industry which will create new jobs and investment in Alabama and allow us to export the products to nearby prohibited areas.

Looking at tax revenues from direct sale of cannabis is terribly short-sighted & completely misses the true potential here.

Loretta Nall said...

Being Libertarian I can relate to what you are saying Evan. However, we will never realistically get where we are going if we don't compromise. I think $50 tax per ounce is too much. But right now we are paying 100% tax and we lose our homes, careers, families, bank accounts, property and freedom under the current law. Prices will drop drastically under legalization and I predict we will be paying less even with the $50 tax than what we pay now for an ounce which is about $140 for schwag and upwards of $300 for good quality product.

I don't really have a problem with a reasonable tax if legalization will put people back to work and enrich the citizens of Alabama by providing funding for services that make this state a better place to live.

The California bill has a provision for those who wish to grow their own. I would hope that should such a bill ever really be discussed here that we would all come together and demand such a provision be in our bill as well.

trizzybob said...

That 10,272 pot arrest in 2002 likly garnered the state and local governments some $20,544,000 in fines recieved. That's based on the average $2,000 fine folks are getting around these parts.

Dale said...

Come on down an git yer 2 eighths of weed fer the price of one. Just call Honest As The Day Is Long Junior's Marijuana Farm and Paraphernalia Emporium at BR-549.

Tell 'em Lulu sent you and we'll thow in a twirl glass chillum for free. That's BR-549.

-Sepp said...

You forgot to add in the potential tourism $$$ brought in by those who live outside the state!

Anonymous said...

i saw this on and seems your putting that recently earned education an early work out

Nick said...

I agree with the compromise. I'd rather get marijuana legalized convincing the big govt folks "hey look, you can tax it and get cash out of people!" than not at all and continue spending crazy amounts of law enforcement money on the drug war. The reduction in taxation can come later.