The draft version of The Cannabis Bill, 2018 has been released in preparation for discussion in Parliament. It is described as “AN ACT to provide for the regulation and control of cannabis for religious use, by documented members of registered religious organisations, to uphold the constitutional rights afforded to each citizen of Antigua and Barbuda; and to provide for the regulation and control of cannabis for medicinal and scientific use within Antigua and Barbuda, to establish the Antigua and Barbuda Medicinal Cannabis Authority whose functions will be described herein, to authorise medicinal and alternative health practitioners to recommend medicinal cannabis, to establish scientific research protocol for medicinal cannabis, and to establish a licensing structure and complete tracking system for medicinal cannabis businesses.” A bit wordy, but it is a lengthy bill, so we thought that a summary was in order.
In the explanatory memorandum, there are six priority considerations. 1) Ensuring that this country keeps within the protocol of the International Drug Conventions, 2) The medicinal benefits to the population, 3) The economic benefits to the population, 4) The social justice benefits to the population, 5) Ensuring that the constitutional rights of the population to freely practice one’s religion is upheld, and 6) Immediately drastically reducing with the intent to totally eliminating the black market supply of cannabis through satisfying the population demand via a controlled, regulated medicinal market. Again, not to bore you with a lot of unnecessary words but this is significant legislation on a controversial subject that needs to be publicly discussed and understood.
We will post the 54-page draft legislation for your review on antiguaobserver.com, but we wanted to touch on a couple of the points in that document that have raised more than a few eyebrows. Today, we will discuss priority number 6, which raises the most obvious questions. If one of the key intents of the legislation is to totally eliminate the black market supply, how is that accomplished via a controlled, regulated medicinal market? We are fairly sure that there are a lot of individuals who use cannabis purely for pleasure. Will they be issued a pleasure prescription so that they can legally obtain their herb? If not, and medicinal herb is the only legal herb, unless you are backyard farming, then the black market supply will continue and may even flourish.
Antigua and Barbuda is not, and will not be, the only country facing the challenges of pitting legal cannabis against an illegal supply. Canada has similar goals and will have similar challenges as they seek to be victorious in the supply chain battle. In that country, the black market for weed is estimated at somewhere between CDN$6 billion to CDN$8 billion, but if you listen to Bill Blair, the Liberals’ Border Security and Organised Crime Reduction Minister, talk about the new legal and supply structures, you could easily replace Canada with Antigua and Barbuda. He said, “We have created a new, regulated, safer commodities industry in Canada that employs Canadians, creates jobs, growth, and other opportunities in our communities and by displacing this business from criminal enterprise… we’re creating a new industry that will actually follow some rules when there’s oversight, testing, and accountability.” Sounds familiar, doesn’t it?
At the same time however, Blair says that the sale of cannabis is the easiest money that organised crime makes, so we doubt that he is under any illusion that the black market will be eliminated. And we need only look at history to let us know that the ability to get legal products does not automatically get rid of the black market. This is generally because the cost of being a conformist (i.e. paying taxes, following regulations, etc.) adds to the final cost of the product and can put legal suppliers at a disadvantage. Black-marketeers do not have those burdens or restrictions. We need only look at cigarettes and alcohol as examples. As legal and freely available as those products are, there is still a thriving black market supply due to cost considerations.
This is the area where the government must be careful in how they tax. Through taxation, they could unwittingly fuel the black market. Back in 2015, Spirits Europe, a trade body in the European Union warned that the tax measures undertaken by several European countries had little effect on curbing drinking habits and had instead, given strength to the black market suppliers. Back then, Paul Skehan, director general of Spirits Europe, said “Today, data suggest there is a correlation between the size of the illegal market and the level of tax/excise burden in relation with disposable income. Squeezed wallets and inflated prices offer an open invitation to criminals selling counterfeit or illicit alcohol products. A perfect storm.“
More recently, the McKenzie Center for Public Policy and the Tax Foundation of Washington, D.C calculated that high taxes (or “sin” taxes as they are called) on cigarettes have led to a thriving black market trade across America, with over 50 percent of all cigarettes sold in New York State being smuggled or considered questionable. The illicit trade costs New York an estimated US$1.5 billion in cigarette excise tax revenue. So, the good intentions coupled with a perception of and desire for “easy money” made a bad situation worse.
None of this is to say that our path is wrong, rather it is a bit of advice that we need to tread carefully so that we do not create a perfect storm that negates advances and maybe even makes things worse.
We invite you to visit www.antiguaobserver.com and give us your feedback on our opinions.