Legalise cannabis and collect more tax, says IEA
Statisticians at the Institute of Economic Affairs reckon the UK could collect more than £1 billion a year in tax revenue if cannabis were legalised.
A report by the right-wing think-tank says about 255 tonnes of weed is sold to three million black-market users at about £2.6 billion a year.
The institute, much favoured as an information source by Margaret Thatcher in the 1980s, is pretty forceful in stating its case.
Black market is awash
"The criminalisation of cannabis in the UK has failed, " is says. "The black market is awash with high-strength, hazardous products. Seizures, prosecutions and health problems place a significant burden on the justice and health systems, while teenagers find it easier to buy cannabis than alcohol.
"The dominance of hazardous, high strength ‘skunk’ cannabis in the black market should be a key reason for legalisation.
"Licensed sales would allow safer, regulated cannabis to displace the more dangerous strains and generate tax revenue that could be spent on mental health services. Regulators could set maximum limits on THC – associated with psychosis – and minimum limits on the non-intoxicating antipsychotic CBD, to reduce the risk of mental health problems.
Cut taxes in other areas
"Moreover, licensed sale would make it more difficult for those under 18 to access the drug, whilst the ability to tax cannabis would allow governments to cut taxes in other areas. Legalisation would also create new jobs and businesses in the legitimate, tax-paying economy, as well as savings in the criminal justice system."
This is an interesting area, particularly when you consider the potential medical uses of marijuana. However, you can't help but think the IEA might have left out this effort at humour in its press release. (Or maybe not!).
Here's Chris Snowdon, IEA head of 'lifestyle economics': “It’s high time for reform of cannabis policy in the UK. Canada and the USA are showing the way. Done properly, the legalisation of cannabis is a win-win-win: criminals lose a lucrative industry, consumers get a better, safer and cheaper product, and the burden on the general taxpayer is reduced.”
Scrutiny of the audit market
Meanwhile, the Big Four are in the news again. It seems that they always are. This time the UK competition watchdog is urging greater scrutiny of the audit market.
The Competition and Markets Authority has met with EY, Deloitte, PwC and KPMG to discuss the (lack of?) effectiveness of market control measures that were introduced in 2015. BDO, Grant Thornton and Mazars — have also been involved in the conversation.
Former Tory MP Andrew Tyrie, took over as CMA chairman in June. Three months ago he said of the audit market: “There must be a competition aspect, there are only four of them, there used to be five, if you go down to three some would . . . consider it an oligopoly.”
Conviviality miss...
And, Big Four-wise, that's not all... the Financial Reporting Council is getting its teeth stuck into another investigation. The latest probe for the accounting watchdog is KPMG’s 2017 audit of Conviviality and an unnamed ICAEW member. It's about the “preparation and approval of Conviviality’s financial statements and other financial information".
Conviviality, a supplier of alcohol to restaurants and bars, hit the skids in April after several profit warnings and the failure to note a fast approaching tax bill.
