New York City Comptroller John Liu today publicly called for the city to legalize marijuana. Liu, who is the chief financial officer for the city, believes it would be a real financial windfall for the city. Also, the new tax revenue could be used to dramatically lower college tuition.
Liu’s plan closely mirrors the laws recently approved by voters in Colorado and Washington State. It would allow adults age 21 and over to possess up to one ounce of cannabis, which could be purchased from government regulated stores.
According to a new report from Liu’s office, Regulating and Taxing Marijuana: The Fiscal Impact on NYC, the city could potentially gain $400 million a year in new revenue from legalizing cannabis. Liu estimates the current marijuana market in the city to be around $1.65 billion. If marijuana was subject to a new 20 percent excise tax, as well as city and state sale taxes, that would bring in around $400 million every year.
In addition, the city could save around $31 million by reducing the number of marijuana arrests. In just the first half of this year the city had over 18,000 misdemeanor marijuana arrests.
Liu wants to use this possible source of new revenue to reduce tuition in the CUNY system. Potentially, tuition could be cut in half for local residents. Of course, this large amount of new revenue could be also used for any number of other worthwhile projects, or even used to reduce other taxes in the city.
Liu is currently running for mayor, but recent polling shows him in fifth place in the Democratic primary. It is a powerful sign of how dramatically the popular opinion about marijuana has changed in the past decade when politicians start endorsing legalization as a way to help their campaign.
Photo by Thomas Good released under Creative Commons License