Australia report reveals potential cannabis legalization plan

The Australian Parliamentary Budget Office (PBO) recently published a proposal examining two options for approaching cannabis legalisation. At the request of Senator David Shoebridge (dubbed Australia’s devil’s lettuce father on his Twitter page) and Australia’s Green Party (aka the Greens), she was tasked with investigating what legalization might look like.

According to the PBO report, the first option would constitute the creation of the Cannabis National Agency (CANA), which would act as the sole wholesaler between producers and retailers, setting wholesale prices for cannabis and issuing licenses to potential cannabis business owners. Ideally, the agency would be funded entirely by the fees required to apply for production and retail licenses.

This option would legalize cannabis for anyone over the age of 18, specifically with no limit to the amount a person can purchase. This approach would also entail penalties for underage sales, similar to how the country handles underage alcohol sales. Recreational cannabis would be available to “overseas visitors,” and residents would be allowed to grow up to six plants. Finally, leisure sales would “entail goods and services tax (GST) and a 25% excise tax on sales inclusive of GST.”

The second option contains all the provisions of the first option, with the exception of the last recommendation, which would change the excise duty to 15% instead of 25%.

The report explains that this approach would be similar to Canada’s cannabis law. In Canada, residents are only allowed to grow up to four plants at home, are not allowed to smoke in public, and are restricted to possession of 30 grams or less.

The PBO predicts that the country could rake in up to AU$28 billion in tax revenue from cannabis in the first decade of legalization.

According to The New Zealand Herald, Senator Shoebridge suggested the tax revenue could also be used to increase rates provided by JobSeeker, the government’s employment service, and to raise financial support provided by the Youth Allowance employment service. He also suggested that cannabis tax revenues could help build more than 88,000 public housing units over the next decade, which could provide homes for more than 250,000 people.

“These costs of the PBO demonstrate the incredible opportunity that legal cannabis creates to not only reduce harm, but also generate revenue that could be reinvested in health, education and public housing,” Shoebridge said. “The Greens’ model creates a right for adults to grow up to six plants in their home tax- and fee-free. This calculation takes this into account. It also guarantees commercial opportunities for cooperatives and local entrepreneurs to grow and sell cannabis, including through regulated cannabis cafes.”

He also explained that legalization just makes sense. “Legal cannabis makes enormous social and economic sense. If we legalize cannabis, we take billions away from organized crime, the police and the criminal justice system, which we can then spend on schools, homes, hospitals and social support,” Shoebridge said.

In addition, he added that legalization reduces the harm caused by criminal injustice and that overall polls show that most Australians support cannabis and use it regularly. “The fact is that almost half of adult Australians have used cannabis at some point. Laws that make almost half of countries criminals fail the pub test,” Shoebridge said. “By legalizing cannabis, you can properly regulate the market, provide consistent health and safety messages, and make the product safer. Right now the only ‘security agencies’ 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 approved, which would ensure cannabis supply far ahead of demand. Applications for production and retail licenses could begin as early as 2023 or 2024, with expectations of starting sales by 2024 or 2025.