marijuana leafWelcome to The Independent Forum. Every week we ask a different question and solicit responses from a diverse group of New Mexico thinkers, pundits and other observers of the state’s political landscape. We’ll add more responses as they come in, so keep checking back to see how the conversation progresses.

We also invite readers to participate — so please share your thoughts on this question in the comments section. If you have suggestions for how we can improve this feature or have have an idea for a future question, send us an e-mail.

This week we’re talking about something many of us probably couldn’t have envisioned only a few years ago: Taxing the sale of pot. With New Mexico’s adoption of medical marijuana comes a bill from Sen. John Sapien that would apply a 25 percent excise tax on the value of medical marijuana sold by producers, as well as a gross receipts tax on its purchase by patients. So, this week’s question is:

“Should New Mexico tax medical marijuana?”

PAUL GESSING, president of the Rio Grande Foundation:

No, I’m against unnecessary tax hikes and this one is no different. As usual, potential savings abound in New Mexico’s budget. For starters, since we are talking about drugs, the state could save $13.2 million annually by simply diverting non-violent offenders convicted of drug possession to probation through increased use of drug courts and mandatory treatment and work programs. The Rio Grande Foundation has outlined a variety of criminal justice-related reforms here.

Literally millions of additional dollars could be saved by simply addressing our state’s bloated government workforce, costly Medicaid system, and by prudently reducing spending at all levels of government.

Besides, if marijuana is indeed essential medicine for thousands of New Mexicans, why in the world would we place such a prohibitive tax on it?

TERRI COLE, president and CEO, Greater Albuquerque Chamber of Commerce:

Senator Sapien is a sensible guy and an impressive business leader. He needs to apply that good, sensible business experience to New Mexico’s tax policy. All legislators, including the most sensible of the bunch, need to focus on consolidating government and cutting government before new tax increases are imposed on anything else. The best tax policy keeps taxation broad-based. The worst tax policy targets “this ‘n that” which only creates an unstable and unfair taxation system. Medical marijuana falls in the “this ‘n that” category of taxation. Let’s get beyond bad tax policy. But first, cut government and consolidate services. There is a good chance that will do it.

JIM BACA, blogger, former director of the U.S. Bureau of Land Management, Albuquerque mayor, state land commissioner and recently retired natural resources trustee:

New Mexico should not tax any medicines, including marijuana.  I wonder if any legislator would ever go out of their way to tax insulin.  Not likely.  So why marijuana?Well, it is a political populist thing to do.  Having said that I do believe marijuana should be legalized and taxed for use other than medicine.  That is realistic.  Let’s face it though. Neither of these ideas are going to fly.

CARTER BUNDY, political action representative, AFSCME:

Well, I knew my streak of agreeing with friends Terri Cole and Paul Gessing would have to end someday! As to the argument that there’s just a ton of fat in state government, this stat should mean something, particularly to Libertarians: There are now fewer classified state employees than at the end of the Johnson administration, and the state has grown by about 10 percent during that period.

I just did one column for Heath Haussamen’s site about where our tax dollars go, so I won’t belabor the point here, but suffice it to say, the vast, vast majority of it goes to things that almost all of us like: K-12 education, health care for poor kids, universities and community colleges, police, fire, corrections, roads, water, wastewater, solid waste, etc.

But let’s say you don’t like the state airplane. Do you really want your governor and lieutenant governor, regardless of party, spending a day at a time driving from Hobbs to Santa Fe to Silver City? OK, you can live with that waste of time. Fine. At most you’ve saved a few million dollars.

Cut exempt employees by 400 without replacing a single one, and not only would basic services suffer, but you’d maybe save $40 million. Now you’ve applied a scorched earth policy, making every part of state government smaller than under famed libertarian Gary Johnson, and you’ve eliminated less than $50 million of an almost $700 million deficit. Furloughing state employees for a week generates a paltry $8 million–hardly a solution to the deficit–but changes the monthly budget for those workers dramatically for the worse.

So my question to both Terri and Paul is what programs would you cut? What further efficiencies do you expect that would be greater than Gov. Johnson’s efficiencies, and if there are some, why didn’t he enact them? And don’t blame unions–Johnson got rid of them.

A few years ago I did a column for NMPolitics.net about the inefficiency of our war on drugs. Now, medical marijuana is different, because it’s medicine, so part of me agrees that we should exempt it from taxes. But the money to fund programs like, for example, the oversight of medical marijuana, has to come from somewhere.

Whatever happened to the conservative philosophy of people paying their own way? This is a tough one, but in a year where we need funding for core services, and we want accountability, asking the consumers of medical marijuana to put something into the system seems like a fairly modest and reasonable idea. You don’t get something for nothing.

RICHARD ANKLAM, president and executive director of the New Mexico Tax Research Institute, former director of tax policy for the New Mexico Taxation and Revenue Department:

Interesting question and I’m sorry to be slow in commenting.  I guess I’m confused as to the policy of the proposed legislation. To follow Jim Baca’s comments, if the notion is to tax “medical marijuana”, then it’s hard to understand why we would treat it’s sale differently for tax purposes than we do other prescription drugs (we currently provide a deduction from NM’s gross receipts tax  (“GRT”) for the sale of prescription drugs).  Why would one prescription pain medication be taxed differently than another?

If we were talking about the implications of a broader legalization policy for purposes of recreational use, then the sale of marijuana would be subject to the GRT under present law, and the discussion might reasonably turn to regulation and taxation in a way akin to alcohol or tobacco.  That said, there may be one argument for differential taxation  – although I know little about the current “industry”, I’ve read that sales of medical marijuana are occurring through not-for-profit organizations, while non-hospital pharmaceutical sales tend to occur through taxable retail pharmacies.  So, even though there’s a GRT deduction for prescription drugs available to anyone, the retail pharmacies would pay income tax on profits earned through such sales, whereas not-for-profits would not.  The percentage of taxation proposed however does not appear to approximate any potential income tax differentials.

And, Paul Gessing has this response for Carter Bundy:

While the question focused on an aburdly narrow tax on medical marijuana, I’m happy to respond to Carter’s missive. First and foremost, reliance on government at all levels has been a systemic problem in NM for decades. This transcended Gary Johnson’s term. Part of our problem is inadequate private sector development.

Now, regarding specific cuts: we have outlined specific savings including Medicaid, criminal justice, higher education administration, repeal of NM’s mini-Davis-Bacon law, limiting film industry subsidies, and a repeal og SB 33 which passed last year and will cost taxpayers millions of additional dollars on construction projects. That’s a start, but NM’s government sector is indeed bloated and reductions must be a part of the solution to the state’s budget problems.

Rev. Holly Beaumont, legislative advocate for the New Mexico Conference of Churches:

As a pastor I walked with people who were battling life threatening diseases like cancer and HIV/AIDS. I wish that medical marijuana had been available to them. The will to live is intrinsically related to one’s quality of life. With serious illnesses like glaucoma, multiple sclerosis, and epilepsy medical marijuana offers a way to manage chronic nausea, anxiety, appetite loss.

Medical marijuana isn’t a cure. It provides desperately needed relief from grinding pain and the toxic side effects of medical treatments that hopefully are.

The Drug Policy Alliance-NM estimates that this tax would generate about $35,000 off the 1,000 New Mexicans who are currently approved for medical marijuana. Many are disabled and barely making it on fixed incomes. We don’t need to impose taxes on the people who can least afford them, financially or otherwise.  There are better choices available to us.

I would encourage those who proposed this idea to consider raising taxes on substances that are harmful to our health like sugar-based sodas and cigarettes rather than food and medical marijuana that are essential.

Let us all hope that when and if we or a loved one need it medical marijuana will be available and affordable.