Corry Takes Cannabis Tax to Court
Although everyone has different tastes and preferences, almost no one in this world likes taxes. Even though taxes provide clean air, clear water and safe roads, no one wants to chip in when the bill comes due.
One such person that is amongst the anti-tax crowd is Denver lawyer Robert Corry. In June, Corry filed a lawsuit against the state of Colorado in an attempt to overturn the state’s special marijuana taxation laws. He also filed for a temporary injunction to suspend marijuana taxation while the case was being decided.
On Friday, August 22, 2014, Corry was in court defending the injunction and making his case against the marijuana taxation laws. According to Denver Westword, Corry’s argument was broken up into four parts, which are as followed:
- Colorado’s marijuana taxation laws are unconstitutional because they violate the Fifth Amendment. Because the Fifth Amendment protects citizens against self incrimination; the suit argues that forcing individuals to pay a tax on marijuana, the state is essentially forcing individuals to incriminate themselves by admitting to violating federal law; as marijuana is still federally illegal. Corry cites the case law examples of LEARY v. UNITED STATES and PEOPLE V. DULEFF; in both cases the defendant was able to successfully make the same argument in their defense.
- As a matter of policy, state and local governments cannot levy and collect taxes on activity that is illegal under the federal government. Because marijuana is illegal on the federal level, Corry argues, so too are the taxes collected.
- The wording of Amendment 64, the bill which legalized recreational marijuana, does not specifically mention levying any excise tax besides the 15 percent tax on cannabis. In addition, there is a provision barring any regulation that is “’unreasonably impracticable.” Corry argues that all taxes levied against marijuana in addition to the original 15 percent tax violate the “’unreasonably impracticable” provision of the law.
- The legal concept of equity should prevail. A broad interpretation of the equity concept can be boiled down to one word: fairness. Essentially, if the judge agrees with any or all four arguments, then it would be unfair to let the defendants (i.e. the state of Colorado) keep the money that was unfairly acquired; and as such, the state should pay everyone back that paid taxes on marijuana.
Although Corry made some compelling points, Denver District Court Judge John W. Madden IV threw out Corry’s injunction. According to The Denver Post, the reason Madden ruled against Corry was that he could not “find that there’s immediate, irreparable injury based on the testimony today.” Madden did not necessarily disagree with Corry’s argument as much as fail to believe that the taxes were doing irreparable harm to the citizens of Colorado.
While Corry and the anti-marijuana taxation crowd lost this particular court battle, the fight is not over. Although the injunction failed, there is still the lawsuit itself that still needs to be ruled upon. There is no set date for the court case as of yet, but it is expected to take several months to settle the issue.
Source: Denver Westword