Australian government report reveals options for legalizing cannabis

The Parliamentary Budget Office The Australian (PBO), which advises Parliament on budget matters, recently published a report exploring two options for addressing cannabis legalization. It was tasked with exploring what legalization might look like at the request of Senator David Shoebridge and of the Australian Greens.

According to the PBO report, the first option calls for the creation of the National Cannabis Agency (CANA), which would act as the sole wholesaler between producers and retailers, would set wholesale prices for cannabis and issue licenses to prospective cannabis business owners. Ideally, the agency would be funded entirely by production and retail licenses.

This option would legalize cannabis for anyone 18 years of age or older, with no restrictions on the amount a person can purchase. This approach would also establish penalties for selling to minors, similar to those for alcohol. Cannabis would be available to «overseas visitors,» and residents would be allowed to grow up to six plants. Finally, recreational sales would be «subject to the Goods and Services Tax (GST) as well as a 25 % excise tax on sales including the GST.».

The second option includes all the provisions of the first option, with the exception of the final recommendation, which would raise the excise tax to 15% instead of 25%.

The report explains that this approach would be similar to the canadian cannabis law. In Canada, residents can grow up to four plants at home (except in Quebec and Manitoba), are not allowed to smoke in public, and are limited to possessing 30 grams.

The PBO projects that the country could collect up to 28 billion Australian dollars in tax revenue from cannabis during the first decade of legalization.

According to the New Zealand Herald, Senator Shoebridge suggested that tax revenue be used to fund JobSeeker, the local Pôle Emploi office, and to increase the financial assistance provided by the employment service Youth Allowance. He also suggested that tax revenue from cannabis could help build more than 88,000 units of public housing over the next decade, providing housing for more than 250,000 people.

«This BDP estimate shows the incredible opportunity that legal cannabis creates not only to reduce harm but also to generate revenue that could be invested in health care, education, and public housing,» Shoebridge said.

«The Greens» proposal establishes the right for adults to grow up to six plants at home without being taxed or having to pay any fees. This cost estimate takes that into account. It also guarantees commercial opportunities for cooperatives and local entrepreneurs to grow and sell cannabis, particularly through regulated cannabis cafes.”

He also explained that legalization simply makes sense.

«Legal cannabis has enormous social and economic significance. When we legalize cannabis, we take billions away from organized crime, the police, and the criminal justice system, and we can then allocate those funds to schools, housing, hospitals, and social services,» said Mr. Shoebridge.

He added that legalization would reduce the harm caused by criminal injustice, and that, overall, polls have shown that most Australians are in favor of cannabis and use it regularly.

«It’s a fact that nearly half of all Australian adults have used cannabis at one time or another. Laws that turn nearly half the country into criminals don’t stand up to the »pub test,’” Shoebridge said.

«When you legalize cannabis, you can properly regulate the market, provide consistent health and safety guidance, and make the product safer. Right now, the only ‘safety regulators’ for the cannabis market are biker gangs and organized crime, and that doesn’t make much sense.»

Commercial cultivation could begin in Australia as early as July 2023 if the PBO’s plans are adopted, which would ensure that the supply of cannabis is well ahead of demand. Applications for production and retail licenses could begin as early as 2023 or 2024, with the hope of launching sales in 2024 or 2025.

A few Australian states have already took the step of decriminalizing cannabis and other drugs.