In 1969, drug guru Timothy Leary challenged the law, which the Supreme Court found to be unconstitutional because it violated the Fifth Amendment. According to Crumbley, “There was a constitutional issue which deemed the stamp a violation of the right to remain silent because the dealer had to fill out tax returns and report the drugs.” As a result, the Controlled Substances Act of 1970 was passed, which specifically outlawed marijuana at the federal level.

 

 

Many states were apparently attracted to the idea of the tax stamp as a way to further penalize drug dealers by fining them for tax evasion. Since 1970, more than two dozen states have enacted laws requiring a narcotics tax stamp, though some have been declared unconstitutional in state courts. States also enjoy the revenue generated by the fines. The Alabama Department of Revenue estimates that more than $1 million has been collected during the nearly two decades that Alabama has had the Marijuana and Controlled Substance Revenue Act on the books. (In chapter 40-17A of the Code of the State of Alabama, marijuana continues to be spelled as it was when it was legal: marihuana.)

All Alabama narcotics tax stamps are purchased anonymously. “I don’t know who they are. And I don’t want to know who they are,” laughs Crumbley. “The first stamps that I remember we ever sold were to a couple of farmers who came in at Christmas time, and they bought ’em for their wives as Christmas presents, ‘just to be cute.’ We sell a lot of stamps [as novelties]. I don’t recall that we’ve ever sold any large quantities of stamps . . . Most of the people we sell to are stamp collectors. But we haven’t sold any stamps in the past year.”

There are three categories of illegal controlled substances, and respective minimum quantities of each, to which tax stamps apply. An individual must have in his possession more than 42.5 grams (1.5 ounces) of marijuana; 7 or more grams of any controlled substance (cocaine or heroin, for example); or 10 or more dosage units (such as pills, that are not sold by weight). In Alabama, marijuana is taxed at $3.50 per gram (one stamp per gram). Each gram of a controlled substance (other than marijuana) is taxed at $200. Every 50 dosage units of a controlled substance that is not sold by weight are taxed at $2,000. According to state code, even counterfeit drugs are also subject to taxation. “We’ve even seen fake Quaaludes,” he says. “Even a fake Quaalude is subject to tax because it was held out to be a controlled substance.”

A few states have been very aggressive with enforcement. North Carolina collected $83 million in the 15 years its law was on the books, according to Laura Lansford, assistant director of that state’s Unauthorized Substances Tax Division, as reported in the Tennessean in December of 2005. The law was declared unconstitutional in 2004. State laws around the country have faced similar challenges based on due process and the right against self-incrimination. Courts have upheld some stamp laws while striking down or limiting others.

In 2005, Tennessee became the most recent state to enact a narcotics tax stamp law. “It’s patently ridiculous. Legal nitwittery,” Allen St. Pierre, executive director of the National Organization for the Reform of Marijuana Laws (NORML), told the Tennessean. “On the one hand, it says you can’t own a substance. And on the other hand, it creates a taxing scheme. . . . The law on its face makes no sense.” Tennessee took in $2.7 million during the first 18 months the law was in place.

According to the NORML web site, in 1937 U.S. government propaganda had convinced Americans that “crazed Mexicans, blacks, and fans of jazz clubs were pushing marijuana ‘reefers’ on school children and honest youths.” On the day the 1937 Marihuana Tax Stamp Act was enacted, Moses Baca bought two joints from Samuel Caldwell in Denver. Judge Foster Symes made the following pronouncement at Caldwell’s ensuing trial: “I consider marijuana the worst of all narcotics, far worse than the use of morphine or cocaine. Under its influence, men become beasts. Marijuana destroys life itself. I have no sympathy with those who sell this weed. The government is going to enforce this new law to the letter.” Caldwell was sentenced to four years’ of hard labor and paid a $1,000 fine. Baca served an 18-month sentence.

At least the marijuana tax stamp gives drug users who find themselves in handcuffs an option to keep the tax man at bay. “They may be going to jail, but they won’t be having any trouble with taxes,” laughs Crumbley. &