BATON ROUGE, LA (NBC33) — A law passed in 1990 is getting new attention, after a state senator brought it up. It allows drug dealers to pay taxes, without having to admit that they earn their living illegally.
The law is called the Marijuana and Controlled Dangerous Substances Tax, and it was written by Rep. A. Dale Smith (D-Pollock).
Senator Dan Claitor (R-Baton Rouge) wants to see it enforced more often, because it is a way for the state to collect from the black market while potentially cutting crime.
But skeptics say it does not fit the times.
The tax is described as as Al Capone law, because the famous gangster was finally sent to jail not for murder, but for tax evasion.
"There's not many Al Capones out there," said Carl Barkemeyer, a criminal defense attorney. "Those days are over."
Under the law, drug dealers are required to pay $3.50 per gram of marijuana, $200 per gram for substances like cocaine or heroin, and $40 per dose of drugs not sold by weight (e.g. ecstasy).
"It's not a legal form of obtaining income. It is Income, and they should be taxed on it. That's kind of the way the tax code is looking at it," Barkemeyer said.
When a dealer buys a stamp, the Department of Revenue is not allowed to ask for any personal information, including the reason the buyer wanted the stamp.
If a person is convicted of being a drug dealer, s/he faces a fine of double the tax which should have been paid plus up to five years in prison.
Additionally, the state may seize any assets the dealer owns. For non-drug crimes, only contraband may be taken and sold by the court.
But Barkemeyer described most defendants in drug cases as being young men with little money to their names, meaning seizures would yield little for the state.
"They're not wealthy, okay? That's why they're doing what they're doing," he said. "This isn't Miami. This isn't the movie 'Scarface.' You don't have drug dealers running around everywhere that are worth hundreds of thousands of dollars."
In records dating back to 2001, the most money collected by the drug tax is $63,358, in the 2006-07 fiscal year. The law recorded a $4,027 loss in 2004-05, and it brought in just $505 last year.
And while some of that money comes from drug dealers, some of it comes from stamp collectors who think a marijuana tax stamp is a novelty. Department of Revenue officials were unable to say what percentage of sales come from drug dealers.
One problem in the enforcement of the law is the difficulty in seizing assets from convicted drug dealers.
"You gotta be able to link them to that defendant," Barkemeyer said. "So let's say for example that the defendant is driving a nice car, living in a nice house. Well, does he have the title for it? Is the house in his name?"
Additionally, the state may struggle to prove ownership of small valuables, such as jewelry and electronics.