Legalizing Cannabis Would Generate £1bn in Tax for the UK

£1bn in Tax for the UK

£1bn in Tax for the UK: There is a potential £1bn on the table for the UK if it legalizes cannabis. A think tank has estimated that legalizing the class B drug would generate £1bn in tax for the UK and could also draw savings from public services such as the police and medical service (savings to the NHS would be around £300m a year). 

A report from the Institute of Economic Affairs states that currently, the UK’s black market in cannabis is valued at £2.6bn. If it were made legal, this black market would be virtually eradicated and legal sales generated could be twice the size of that of the cider industry. The added taxes, excise duty, and business streams would create a “windfall” for the Treasury.

This week the government is reviewing the use of medical cannabis following two controversial cases last week which involved seriously epileptic children and their cannabis oils being revoked by the police. 

At the moment the Home Office has stressed, however, that the drug will remain illegal for recreational use.

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£1bn in Tax for the UK: The IEA Believe’s in Legalisation

Chris Snowdon, head of lifestyle economics at the IEA, said the following: “Canada and the USA are showing the way…Done properly, the legalization of cannabis is a win-win-win: criminals lose a lucrative industry, consumers get a better, safer and cheaper product, and the burden on the general taxpayer is reduced.”

Canada has recently passed a law to legalize recreational cannabis and a number of US States (30 in total) have varying allowances between medical and recreational cannabis. The first country in the world to legalize the sale of cannabis for recreational use was Uruguay in December 2013.

Snowdon continued: “Legalisation would also create new jobs and businesses in the legitimate, tax-paying economy, as well as savings in the criminal justice system,”

Arguments against legalization include the mental health risks that cannabis use can carry, and that normalizing any drug amongst children, in particular, will lead to greater addictions and health problems down the road.

Cannabis in the UK – The Facts:

-Cannabis is the most widely-used controlled substance in Britain.

-It is estimated that around three million people used a total of 255 tonnes of cannabis last year. 

-Anyone found in possession of the drug faces imprisonment for up to five years and dealing in it is punishable by a 14-year jail sentence.

-The average cannabis user uses an average of 1.6g per week

-One gram has a street value of £10.

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