Showing posts with label excise tax. Show all posts
Showing posts with label excise tax. Show all posts

Monday, March 8, 2010

Tax soda, pizza to cut obesity, researchers say


In the March 8, 2010 article "Tax soda, pizza to cut obesity, researchers say," Julie Steenhuysen reports that excise taxes on pizza and soda might help reduce obesity.
CHICAGO (Reuters) – U.S. researchers estimate that an 18 percent tax on pizza and soda can push down U.S. adults' calorie intake enough to lower their average weight by 5 pounds (2 kg) per year.

The researchers, writing in the journal Archives of Internal Medicine on Monday, suggested taxing could be used as a weapon in the fight against obesity, which costs the United States an estimated $147 billion a year in health costs.

"While such policies will not solve the obesity epidemic in its entirety and may face considerable opposition from food manufacturers and sellers, they could prove an important strategy to address overconsumption, help reduce energy intake and potentially aid in weight loss and reduced rates of diabetes among U.S. adults," wrote the team led by Kiyah Duffey of the University of North Carolina at Chapel Hill.

With two-thirds of Americans either overweight or obese, policymakers are increasingly looking at taxing as a way to address obesity on a population level.

California and Philadelphia have introduced legislation to tax soft drinks to try to limit consumption.

CDC director Dr. Thomas Frieden supports taxes on soft drinks, as does the American Heart Association.

There are early signs that such a policy works.

Duffey's team analyzed the diets and health of 5,115 young adults aged age 18 to 30 from 1985 to 2006.

They compared data on food prices during the same time. Over a 20-year period, a 10 percent increase in cost was linked with a 7 percent decrease in the amount of calories consumed from soda and a 12 percent decrease in calories consumed from pizza.

The team estimates that an 18 percent tax on these foods could cut daily intake by 56 calories per person, resulting in a weight loss of 5 pounds (2 kg) per person per year.

"Our findings suggest that national, state or local policies to alter the price of less healthful foods and beverages may be one possible mechanism for steering U.S. adults toward a more healthful diet," Duffey and colleagues wrote.

In a commentary, Drs. Mitchell Katz and Rajiv Bhatia of the San Francisco Department of Public Health said taxes are an appropriate way to correct a market that favors unhealthy food choices over healthier options.

They argued that the U.S. government should carefully consider food subsidies that contribute to the problem.

"Sadly, we are currently subsidizing the wrong things including the product of corn, which makes the corn syrup in sweetened beverages so inexpensive," they wrote.

Instead, they argued that agricultural subsidies should be used to make healthful foods such as locally grown vegetables, fruits and whole grains less expensive.

Wednesday, December 9, 2009

Tax sugary drinks to fight the flab, says expert


In the December 9, 2009 Reuters article "Tax sugary drinks to fight the flab, says expert," Kate Kelland reports that a nutrition expert favors an excise tax on sugary drinks to reduce their consumption. This is in line with the discussion of incentives on this blog. Economic policy can be summarized in two sentences: If you want more of something, subsidize it. If you want less of something, tax it.

LONDON (Reuters) – If Barry Popkin had his way, sugary drinks would be taxed like cigarettes, and the levy would go up and up until societies were weaned off them and stopped piling on weight.

A nutrition expert who has advised the U.S. government and health policy makers around the world, Popkin says the epidemic of obesity and weight gain sweeping the globe could be slowed dramatically if people revised the mantra "you are what you eat" to include "you are what you drink."

Reviving a taste for water could cut between 300 and 600 calories a day from the diet of an average American or Mexican and almost as much from the intake of many Europeans, he says.

"Depending on the country you live in, we now have between 10 and 25 percent of all calories consumed in sugary or caloric beverages," Popkin, a professor of nutrition at the University of North Carolina, told Reuters during a visit to Europe.

"This change has been phenomenal, particularly in the past 25 years. It's not the sole cause of the global obesity problem, but it's the thing we can change with the least affect on people's food intake."

Data on weight gain and rising obesity levels leave little room for doubt that fat is threatening to overwhelm health care systems and government health budgets around the world.

A report released on Wednesday said one in three American adults is obese, while a 2008 study by Popkin on China suggested obesity levels there are also rising rapidly, with more than a quarter of the population overweight or obese.

The number of people with diabetes - one of the major chronic diseases caused by excess weight - is already reaching epidemic levels, with an estimated 180 million people suffering from it around the world.

Diabetes cases are forecast to triple in the United States in the next 25 years to 44 million with the costs of caring for them rising to $336 billion a year.

Popkin reckons there are now around 25 countries where more than half of adults are overweight or obese and in many rich countries as well as some middle-income nations like South Africa, Mexico and Egypt, the rate is between 60 and 70 percent.

The World Health Organization said in October that being overweight has now overtaken being underweight among the world's leading causes of death.

Popkin, who has studied diet in many countries in Europe, Asia, the Middle East and the United States say the shift away from water to sugary drinks could be responsible for between a third and two thirds of the weight gain in the past 30 years.

"The obesity and weight issue is now bearing heavily on us and our health care costs," he said. "And it's getting worse."

But Popkin says efforts to tackle rising weight levels are focused too much on promoting exercise and healthier eating, and ignore the huge impact of calorie-laden drinks like juices, alcohol, fizzy soda and high fat, sugary milkshakes.

"Activity is not the solution - you can't run off a Coke or an ice-cream cone or candy bar very easily - it takes a lot of exercise to offset an extra hundred calories," he said.

The nutrition expert says the basic problem is that when people shift from drinking water or unsweetened tea and coffee to sugary drinks and juices, they don't cut their food intake.

But since the biological mechanisms controlling thirst and hunger are separate, he says reducing calories by changing people's drinking tastes - rather than chasing elusive ways to cut their eating - is a viable way of fighting fat.

Popkin acknowledges it would take time - probably a decade - to change the world's tastes away from sugary drinks, but he said policy makers should look at tobacco as an example and use taxes as their weapon.

Ever higher taxes on smoking and policies to ban smoking in public paces are helping cut tobacco use in Europe - and studies show a positive effect on cancer rates.

"I'd like a system where sugary drinks were taxed the most, diet drinks less and water not at all," Popkin said. "If that tax added even 15 or 20 percent to the cost, it would have a significant effect on weaning society off sugary drinks."

Sunday, October 11, 2009

Is this cruise tax a head tax, an excise tax, or both?

In the October 6, 2009 Anchorage Daily News editorial "Cruise industry muddies water on head tax," Chip Thoma defends head taxes imposed on cruise passengers. With a head tax, every person pays the same monetary amount, regardless of income. (The tax is paid per person, or per head.) A head tax is also called a poll tax or a lump-sum tax.

This particular tax is also an excise tax. An excise tax is one that is paid on the consumption of a product. In this case, the product is passage on a cruise. Other excise taxes, such as taxes on fuel, cigarettes, or alcohol, are NOT head taxes.
Cruise tourism has been in the news lately, including stories of a lawsuit advanced by the Alaska Cruise Association claiming that the 2006 voter-approved passenger excise tax is illegal. Some recent history will explain what is really going on.

Over a decade ago, Juneau voters approved a local initiative requiring that cruise passengers pay a $5 excise, or head tax. Despite dire industry predictions that the tax would ruin business, more than $40 million dollars has been collected and spent on cruise passenger improvements. Significantly, cruise passenger visitation to Juneau has doubled since the tax was levied, to 1 million a year.

Throughout the world, cruise ports charge taxes to pay for necessary improvements and services for ships and passengers, including wharves, roadways, bathrooms and medical response. Without reasonable taxes, port residents would be forced to shoulder all these improvements. Having passengers pay for needed infrastructure that welcomes 1,000-foot ships and many thousands of cruise tourists daily in a compressed season makes sense for everyone.

In 2006, Alaska voters approved a state initiative by 52 percent to 48 percent that charges cruise passengers a $50 head tax. The tax generates $50 million per year and pays for cruise ship infrastructure in a dozen Alaska cruise ports. The tax also pays for state Ocean Rangers to monitor shipboard pollution control.

Importantly, the cruise companies do not pay any of this head tax. The total tax is paid by passengers when they purchase Alaska cruise tickets. Media reports this summer revealed that Alaska cruise passengers were completely unaware of the head tax. And when asked, most thought the $50 was reasonable and the purposes for the head tax appropriate.

With the economic recession, the gloom-and-doom spokesmen for the cruise industry predicted catastrophe this year. Blame for the upcoming disaster was placed squarely on the 2006 passenger head tax. But the reality was quite different.

The ships were full in 2009. The million passengers who sailed to Alaska this summer spent their discretionary money on budget bus tours, short tram rides and T-shirts, operations that all recorded record revenues. Expensive side trips were down, like flightseeing and whale watching, a result expected in an economic recession.

The obvious lesson is that passengers this summer were happy to visit Alaska, but were unwilling to spend for expensive extras. Another salient point is that the $50 head tax didn't keep anyone from sailing on cruise ships to Alaska in 2009.

A disappointing aspect about cruise taxation is the continual duplicity of the industry. The Miami-based cruisers whine about the tax but refused to comment on cruise-related projects approved for funding this year in the Legislature. Instead, the cruise lines recently filed a lawsuit claiming the tax and some of the funded projects are illegal.

The hypocrisy by the cruisers has been constant. Cruise lobbyists claim the $50 passenger tax greatly impacts their bottom line, yet the 2009 cruise passengers who pay the entire tax are blissfully unaware of it. The industry persists in their divide-and-conquer tactics toward local ports, promising dire consequences to local revenues if the head tax is not repealed. But that very head tax pays for local port projects and allows for more safe and efficient cruise ship visits.

In any discussion of state-to-industry relationships, there are adversarial points that need careful listening and proper resolution. In the case of the cruise industry, the clear reality is that a fair tax on passengers must be charged to pay for vessel-related infrastructure and services. Alaskans also demand that no pollution will be tolerated from the dozens of floating ship-cities. Alaskans want a say in how our communities and productive marine waters are used.

Alaskans statewide are tired of the overblown cruise industry rhetoric. The industry should be active in the legislative finance process that determines project funding instead of filing Hindenburg-style lawsuits.

Juneau resident Chip Thoma is president of Responsible Cruising in Alaska. He has been involved in cruise ship regulation issues for 12 years.

Saturday, September 19, 2009

President Barack Obama hinted he could support a "sin tax" on fizzy drinks to help lower high rates of US obesity


A man drinks a bottle of soda in California. President Barack Obama hinted he could support a "sin tax" on fizzy drinks to help lower high rates of US obesity, but admitted it would be an uphill battle against corporate and economic interests. (AFP/Getty Images/File/Justin Sullivan)

Calif. lawmaker plans hearings on soda-obesity link

In the September 17, 2009 article "Calif. lawmaker plans hearings on soda-obesity link," Lisa Baertlein reports "the California lawmaker who spearheaded a high-profile anti-obesity effort across the country's most populous state is now training his sights on sugar-sweetened drinks."
Sen. Alex Padilla, who led a campaign requiring big restaurant chains to disclose calories in meals, said on Thursday he planned to hold hearings in November on the link between soda consumption and obesity.

The announcement from Padilla -- who chairs the California Senate's Select Committee on Obesity and Diabetes -- coincides with the release of a study that shows nearly two-thirds of children aged 12 to 17 gulp down at least one sugar-sweetened beverage daily.

According to the UCLA Center for Health Policy Research and the California Center for Public Health Advocacy, 62 percent of children aged 12 to 17, and 41 percent of children aged 2 to 11, drink at least one sugar-sweetened beverage a day.

"I don't think that most parents truly appreciate the role soda pop has in causing weight gain," Padilla said. "It is unfortunate that soda is actually cheaper than milk and even bottled water in many instances."

Padilla said California needs to do more to educate the public about the health effects of drinking too much soda and to consider its options for reducing soda consumption among children.

California was the first state to pass menu labeling rules and has been among the pioneers of public health initiatives such as bans on artery-clogging trans-fats in restaurant cuisine and on soda sales in public schools.

Experts say the U.S. obesity epidemic has turned into a public health crisis and overweight adolescents are starting to suffer problems that used to plague mainly middle-aged adults -- early heart disease and type 2 diabetes.

SHARP CUTBACK RECOMMENDED

The American Heart Association in August took on the $115 billion soft drink industry, recommending that Americans cut back dramatically on sugar and singling out soft drinks as the top source of "discretionary" sugar calories.

The group said women should eat no more than 100 calories of added processed sugar per day, or six teaspoons (25 grams), while most men should keep it to just 150 calories or nine teaspoons (37.5 grams).

To put that in perspective, one 12-ounce (355-millilitre) can of soda can contain as much as 13 teaspoons (54.6 grams) of sugar, often in the form of high fructose corn syrup.

That's more than half the total 22 teaspoons (90 grams) or 355 calories of added sugar consumed by the average American each day, according to a 2004 government survey.

Being overweight costs, experts say.

Obesity-related diseases account for nearly 10 percent of all medical spending in the United States, or an estimated $147 billion annually. Health experts increasingly are calling for taxes on soft drinks and other sweetened beverages to offset medical costs and fund public health efforts.

"If we are serious about curbing the obesity epidemic, we have to start with the biggest culprit," said Harold Goldstein, executive director of the California Center for Public Health Advocacy.

A strongly worded report on child obesity released earlier this month recommended that state and local governments tax junk food and soft drinks, give tax breaks to grocery stores that open in blighted neighborhoods and build bike trails. Some public health experts would like to see tax proceeds used to make fresh fruits and vegetables more affordable.

The American Beverage Association has opposed efforts to tax soda and other beverages and says it provides a wide variety of beverage choices, including drinks with zero calories.

"If our goal is to address obesity, then educating consumers about the importance of balancing calories consumed from all foods and beverages with the calories expended through physical activity is what matters -- not demonizing any one particular food," the group said in a statement on Thursday.

An industry group called Americans Against Food Taxes -- whose backers include soft drink maker PepsiCo Inc, the American Beverage Association, the Corn Refiners Association and McDonald's Corp -- is running anti-soda tax advertisements on television, radio and on the Internet.

Tuesday, August 4, 2009

Junk Food Taxes


Waist banned
Jul 30th 2009
From The Economist print edition

Does a tax on junk food make sense?

ECONOMISTS have long recognised the arguments for imposing special taxes on goods and services whose prices do not reflect the true social cost of their consumption. Such taxes are known as “Pigouvian” after Arthur Pigou, a 20th-century English economist. Environmental taxes are an obvious example. There is also a Pigouvian case for duties on cigarettes, alcohol and gambling. Smoking increases the risk of cancer for those in the vicinity of the smoker; alcohol abuse and gambling are strongly associated with violence and family breakdown. Moreover, all three habits lead to higher medical costs. In theory governments can make up these costs, or “externalities”, with a tax that adjusts the prices people pay to puff, booze or punt. Such a tax might also encourage consumers to live healthier lives.

Support for another such tax, on junk food, is now spreading, especially in America. Congress is considering a tax on sugary drinks to help pay for the planned expansion of health-care coverage. Some analysts would like to see broader duties on junk food. On July 27th the Urban Institute, a think-tank in Washington, DC, proposed a 10% tax on “fattening food of little nutritional value” that, it claimed, would raise $500 billion over ten years.


The logic for a tax on fattening food may seem obvious. About one-third of Americans are obese, up from 15% in 1980. Fat people are more prone to heart disease, diabetes, bone disorders and cancer. An obese person’s annual medical costs are more than $700 greater than those of a comparable thin person. The total medical costs of obesity surpass $200 billion a year in America, which is higher than the bill for smoking. These costs are not all borne by the obese. When health-care costs are shared, obesity becomes a burden for everyone. Thanks to government health-care plans such as Medicare half of America’s obesity-related health costs land on taxpayers. In private employer-sponsored health plans the slim pay similar premiums to the overweight.

But would a fat tax affect behaviour? Numerous studies have shown a relationship between the price of food, especially junk food, and body weight. As fast food has become relatively cheaper, so people have become fatter. A new paper* from the RAND Corporation, another think-tank, suggests that taxing calories could have a sizeable, if gradual, effect on people’s weight. The authors of the study look at changes in the weight and height of a large group of Americans aged over 50 between 1992 and 2004. They then calculate food-price indices that are skewed towards calorie-dense foods (so a change in the price of butter has more impact than a change in the price of vegetables). By controlling for individual and environmental influences on weight, such as income and health, they then measure whether food-price changes affect body-mass index (BMI). BMI, the ratio of weight in kilograms to the square of height in metres, is a common, if imperfect, gauge of whether someone is over- or underweight.

A person’s BMI turns out to be hard to shift in the short term. A 10% increase in the calorie-heavy price index is associated with a small decline, of 0.22, in BMI within two years. But the effects are greater over the longer term. A 10% increase in the price of calories results in a fall in BMI of one to two points over 20 to 30 years. Such a drop would eliminate about half of the observed increase in obesity in America since 1980.

Even so, the idea of tackling obesity via the tax system has some serious flaws. First, there is the question of what to tax. Sugary drinks may not be nutritious, but hamburgers contain some protein along with their fat. More important, junk food is not itself the source of the externality—the medical costs that arise from obesity. Unlike smoking, or excessive gambling and drinking, eating junk food does not directly impair the well-being of anyone else. And because obesity is determined by lack of exercise as well as calorie intake, its ultimate relationship with health costs is more tenuous than that of, say, smoking. It is possible to eat a lot of fatty food, exercise frequently and not generate any externalities. A more direct, though controversial, approach would simply be to tax people on the basis of their weight.

Fat chance
The distance between junk food and the medical costs of obesity means that a calorie tax could have unintended consequences. A new theoretical paper in the Journal of Public Economics even suggests that a tax on junk food could increase obesity, especially among physically active people. If junk food, which is quick and easy to obtain, becomes relatively dearer, people will spend more time shopping for fresh ingredients and preparing food at home. That could leave less time for exercise.

Even if perverse consequences of this type look improbable, a junk-food tax may have less impact than its advocates expect. New studies on the effect of cigarette and alcohol sin taxes suggest heavy users are less influenced by price changes than others. An analysis of data from the National Longitudinal Study of Adolescent Health shows that American teenagers who smoke more than five cigarettes a day are only one-third as responsive to cigarette prices as lighter smokers. A complementary study of data from America’s Health and Retirement Survey shows that alcohol taxes are far less effective for the large minority of heavy drinkers. The biggest consumers of fattening food may prove similarly resilient to price increases, so a fat tax may do little to improve health, at least for today’s junk-food addicts. If these same consumers are poorer on average, it would also be regressive. One reason for this is that in some poorer neighbourhoods there may be little fresh food on sale. If junk is all there is, putting up its price will reduce real incomes and make little difference to eating habits and health. Like the foods they aim at, fat taxes look appetising but can have nasty effects.

Thursday, July 30, 2009

Tax sodapop to fight fat, US health officials say

Economic policy in two sentences: (1) If you want more of something, subsidize it. (2) If you want less of something, tax it. The July 30, 2009 article "Tax sodapop to fight fat, US health officials say" by Karin Zeitvogel discusses a proposal to tax soda to discourage its consumption:
WASHINGTON (AFP) – US health sheriffs want to ride the sugary drinks that are helping to make Americans fat out of town, or at least off Americans' menu of choice, and one way they suggest going about it is by taxing sodapop.

"The average American consumes roughly 250 calories more today than they did two or three decades ago, the head of the Centers for Disease Control and Prevention (CDC), Thomas Frieden, said at the "Weight of the Nation" conference on obesity held in Washington this week.

"And of that, about 120 calories is in the form of sodas and other sugared food and beverages," he said.

The average daily recommended caloric intake for adults is about 2,000 calories per day, a number that varies depending on a person's sex, height, weight and rate of activity.

Two-thirds of American adults are obese or overweight -- or shaped more like the bulbous Orangina bottle than the hourglass classic Coca-Cola bottle -- and obesity-related illnesses cost the United States nearly 150 billion dollars a year, health officials at the conference were told.

A soda tax would not only help Americans to slim down but could raise revenues that would help to offset the rising sums spent to treat preventable health conditions caused by obesity.

"The estimates we've seen suggest that a one-penny-per-ounce tax nationally would raise something in the order of 100 to 200 billion dollars over a 10-year time frame, as well as significantly reducing caloric intake -- at least from soda and sugar-sweetened beverages," Frieden said.

According to Julie Greenstein of the Center for Science in the Public Interest (CSPI), around 40 of the 50 US states already have soft drink or junk food taxes, but they are usually too low to have an effect on consumption.

The CSPI, which has advocated for health, nutrition and food safety in the United States since 1971, says a soft drink tax would "be a great way to pay for health reform and expansion" and wants to see such a tax imposed nationally.

A tax on soft drinks was included as a possible option in the health reform bill drafted by the Senate finance committee, said Greenstein, although she was unsure if the proposed levy would make it through to the final version of the proposed health care legislation.

"The soft drink industry has a very powerful lobby," she said.

Last week, the Coca Cola Corporation was quoted in the Financial Times as saying that "the consumer in this environment is not ready for a tax on a basic staple like non-alcoholic beverages."

Frieden has based his call for a soda tax on the campaign he instigated in New York City, where he was health commissioner for seven years, which practically ran the Marlboro man out of town.

A year after he became health commissioner of New York in 2002, Frieden started raising taxes on cigarettes to the point where if you buy a packet of 20 in the Big Apple today, you don't get much change from 10 dollars.

He reasoned that people would kick their cigarette habit if it cost too much. And he was right.

"We reduced adult smoking by 25 percent and teen smoking by 50 percent in six years. About half of that reduction was the result of taxation," Frieden said.

A similar tactic applied to sodas could help to cut consumption of the sugary drinks, he reasoned, but added that the decision to impose a national soda tax was one for the politicians, not health officials.

"Whether it gets done is a political question, but what we can say as the nation's prevention agency is that obesity is an enormous problem, and price interventions are likely to be effective," he said.

Wednesday, July 22, 2009

Is Marijuana the Answer to California's Budget Woes?


A July 22, 2009 article by Tom McNichol in TIME magazine asks "Is Marijuana the Answer to California's Budget Woes?":
Proponents of marijuana legalization have advanced plenty of arguments in support of their drug of choice — that marijuana is less dangerous than legal substances like cigarettes and alcohol; that pot has legitimate medical uses; that the money spent prosecuting marijuana offenses would be better used on more pressing public concerns.

While 13 states permit the limited sale of marijuana for medical use, and polls show a steady increase in the number of Americans who favor legalization, federal law still bans the cultivation, sale, or possession of marijuana. In fact, the feds still classify marijuana as a Schedule I drug, one that has no "currently accepted medical use" in the United States.

(See a TIME video on Medical Marijiuana Home Delivery)

But supporters of legalization may have been handed their most convincing argument yet: the bummer economy. Advocates argue that if state or local governments could collect a tax on even a fraction of pot sales, it would help rescue cash-strapped communities. Not surprisingly, the idea is getting traction in California, home to both the nation"s largest supply of domestically grown marijuana (worth a estimated $14 billion a year) and to the country"s biggest state budget deficit (more than $26 billion).

On Monday, Gov. Arnold Schwarzenegger and the California legislative leaders a tentative budget agreement to plug the state's deficit, but it would involve making sweeping cuts in education and health services, as well as taking billions from county governments. Democratic state assemblyman Tom Ammiano has introduced legislation that would let California regulate and tax the sale of marijuana. The state's proposed $50 an ounce pot tax would bring in about $1.3 billion a year in additional revenue. Ammiano's bill was shelved this session but he expects to introduce a revised bill early next year.

(Read "Can Marijuana Help Rescue California's Economy?")

If the state legislature doesn"t act, perhaps California voters will. One group is preparing to place a statewide initiative for the November 2010 ballot that would regulate and tax the sale of marijuana for Californians 21 years of age and older. Tellingly, the group spearheading the measure calls itself TaxCannabis2010.org, stressing the revenue advantages of marijuana legalization. The group hopes to collect the required 650,000 voter signatures by January to place the measure on the November 2010 ballot.

"There"s no doubt that the ground is shifting on marijuana," says Ethan Nadelmann, executive director of the Drug Policy Alliance, which promotes alternatives to the war on drugs. "The discussion about regulating and taxing marijuana now has an air of legitimacy to it that it didn"t quite have before. And the economy has given the issue a real turbo charge."

(Read "Can Marijuana Help Rescue California's Economy?")

The legalization effort is getting serious consideration from surprising quarters. In May, Gov. Arnold Schwarzenegger publicly called for a large-scale study to determine whether to legalize and tax marijuana.

"I think it"s time for a debate," the governor said at a news conference. "I think we ought to study very carefully what other countries are doing that have legalized marijuana and other drugs."

(See a TIME photoessay on Cannabis Culture)

In California, medical marijuana sales are already taxed, and some communities are looking for ways to get a bigger slice of the pot pie. Residents Oakland are currently voting in a mail-in special election that includes a measure which would make the city the first in the country to establish a new tax rate for medical marijuana businesses. If the measure passes, Oakland marijuana dispensaries, which are now charged at the general tax rate of $1.20 per $1,000 in receipts, would see that rate raised to $18 per $1,000.

A Field Poll conducted in California this spring showed 56% of the state"s registered voters in support of legalizing and taxing marijuana as a way of offsetting some of the budget deficit. Several national polls have shown that more than 45% of American adults are open to legalizing pot, about double the support a decade ago.

Even the most ardent marijuana advocates aren"t expecting nationwide legalization anytime soon. Instead, any action is likely to come on the state and local level. For now, all eyes are on cash-strapped California, where high taxes could take on an entirely new meaning.