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Australia Report Reveals Potential Cannabis Legalization Plan

Recently, the Australian Parliamentary Budget Office released two proposals on cannabis legalization. This was done to examine what legalization would look like at the request of Sen. David Shoebridge (described on his Twitter page as “the devil’s lettuce daddy of Australia”) and the Australian Greens Party (also referred to as the Greens).

According to the PBO’s report, the first option would establish the creation of the Cannabis National Agency (CANA), which would act as the sole wholesaler between producers and retailers, set wholesale prices on cannabis, and issue licenses to potential cannabis business owners. The fees for applying for retail and production licenses would fund the agency in full.

The option of legalizing cannabis would apply to anyone aged 18 or older. There is no limit on how much marijuana a person can buy. The country would have to penalize anyone selling cannabis to children. This is similar to the way it regulates alcohol sales to minors. Recreational cannabis would be available to “oversea visitors,” and residents would be allowed to cultivate up to six plants. Finally, recreational sales would “attract the Goods and Services Tax (GST) as well as an excise of 25% on GST-inclusive sales.”

With the exception of one recommendation that would reduce the excise tax from 25% to 15%, the second option has all the same provisions as the first.

The report explains that this approach would be similar to Canada’s law on cannabis. Residents in Canada are allowed to grow up to 4 plants, but cannot have them in public. They can also possess a maximum of 30g.

PBO estimates that Australia could earn up to AU$28billion in taxes on cannabis within the first ten years of legalization.

Based on The New Zealand Herald, Sen. Shoebridge suggested that the tax revenue could also be used to raise rates provided by JobSeeker, the government’s job finding service, and raise financial aid provided by the job service Youth Allowance. In addition, he suggested that more than 88,000 housing units could be built with cannabis tax revenues in the next decade. That could allow more than 250,000 people to own a home.

“This costing from the PBO shows the incredible opportunity legal cannabis creates to not just reduce harm but to generate revenue that could be invested in health, education and public housing,” said Shoebridge. “The Greens’ model creates a right for adults to grow up to six plants at home without being taxed and without having to pay. That is why the costing includes it. It also guarantees commercial possibilities for co-operatives and local entrepreneurs to grow and sell cannabis including through regulated cannabis cafes.”

Also, he said that legalization makes perfect sense. “Legal cannabis makes enormous social and economic sense. When we legalise cannabis we take billions away from organised crime, police and the criminal justice system and we can then spend it on schools, housing, hospitals and social support,” Shoebridge said.

He also stated that legalization decreases criminal justice’s harm and that polls show that the majority of Australians are open to using cannabis. “It’s a fact that almost half of adult Australians have at one time or another consumed cannabis. Laws that make almost half of the country criminals don’t pass the pub test,” Shoebridge said. “When you legalise cannabis you can properly regulate the market, provide consistent health and safety advice and make the product safer. Right now the only ‘safety regulators’ for the cannabis market are bikie gangs and organised 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 cannabis supply is well ahead of the demand. With the expectation that sales will begin in 2024 and 2025, applications for retail and production licenses may be filed as soon as 2023.