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France has the highest cannabis consumption in Europe. It's high time to tax it Alexander Hurst The Guardian Wednesday 27 Nov 2024 France might not be broke, but the state of its public finances is, well, definitely not good. Total debt stands at €3.2tn – 112% of GDP. Interest payments on that debt are the second largest public expenditure after education (which includes everything from crêche, or preschool, to universities) and are higher than the amount spent on defence. And this year’s budget deficit is projected to be 6%, three points above the EU’s 3% limit. If it weren’t for the euro, France might very well be in the throes of a fiscal crisis – as it is, interest rates on some French debt are higher than for Portugal or Spain. In response, the prime minister, Michel Barnier, has proposed €20bn of tax rises (on large companies and the wealthiest 0.3% of households) and €40bn of spending cuts. Yet, with both Marine Le Pen’s National Rally (RN) and the leftwing New Popular Front (NFP) opposed to different components of Barnier’s upcoming budget, the French PM might not survive a no confidence motion when he tries to push the bill through parliament before Christmas. I don’t necessarily agree with Barnier, but given the complexity of the challenge, I would sympathise with him if he were to throw up his hands, sprawl on a couch, light up a joint, and skip work. This actually raises a relevant question: why not legalise cannabis and tax it in order to save money on law enforcement and to raise money in taxes for government coffers? I know that sounds far-fetched, and I’m under no illusions that Barnier is considering it, or ever would. So why bring it up? First, because crises provide openings for experimentation – something France needs rather than an endless replaying of the same debates over ending medical care for undocumented people or lowering the retirement age back to 60. And second, because the French are preoccupied with criminality and the economy, and this issue strikes at both. Here’s a French paradox for you – though less fun than the one involving lots of cream and low incidence of heart disease. According to the EU drugs agency, France has the highest cannabis consumption in Europe, and also some of the continent’s strictest drug laws. The French interior ministry reports that roughly 200,000 people a year pass through the criminal justice system on some sort of drug-related charge. And even if not all of those are cannabis-related, and even if most defendants don’t actually end up in prison, anti-cannabis enforcement still costs a pretty penny. A 2019 study by an economic advisory board within the French prime minister’s office found that the state spent €570m a year on anti-cannabis enforcement and legal proceedings. The same report recommended legalising recreational use, selling it through a state monopoly and using some of the resulting revenue to help former small-time dealers find productive and legal employment. The report’s author, Emmanuelle Auriol, a professor at the Toulouse School of Economics, concluded that legalisation could create between 40,000 and 80,000 (legal) jobs, and result in €2.8bn in fiscal receipts for the French government. And add to that the savings in money currently spent on anti-cannabis policing. “While enforcement costs wouldn’t completely go away, at least there wouldn’t be the problems with dealing on corners, stray bullets and score-settling between traffickers that monopolise the police’s time and cost them a lot of money,” Auriol told me. Proposals for decriminalising or legalising illicit drugs always run the risk of being tagged as “soft on crime”, so I want to emphasise Auriol’s point about stray bullets. Last month, France was shocked by high-profile incidences of gang-related violence, including a contract killing involving a 14-year-old boy and a Marseille drug gang. And 85% of people feel that delinquency has risen over the past few months. Legalising cannabis isn’t about going soft on crime – it’s about removing a highly lucrative market from criminal hands, undercutting gangs’ revenues, and taking dealers off street corners. And when it comes to pure financial costs, what was true in 2019 is even more salient today. France’s justice ministry is facing €500m in budget cuts in 2025. (Wait a minute, €500m … if only there were a single item somewhere that could save more or less €500m.) Even under different economic circumstances, spending €950 per cannabis user to fight consumption – only to end up with the highest use rates in Europe – is wildly inefficient, illogical and financially irresponsible. But in this context, isn’t it also just kind of dumb? Emmanuel Macron sparked bitter political divisions when he changed France’s wealth tax in 2018 to target only property and not investment assets. If it had remained unchanged, the tax would have brought in €4.5bn more in 2022. Given that cannabis legalisation would return an estimated €3.4bn to the French government through enforcement savings and tax receipts, shouldn’t there be just as loud a call to legalise cannabis as there has been to restore the wealth tax ? Portugal began a large-scale experiment in decriminalisation 20 years ago, resulting in drastic declines in overdoses and incarcerations according to figures from 1999 to 2017. More recently, Uruguay, Canada and an assortment of US states have all legalised recreational cannabis. Most studies so far have found moderately positive criminal justice and economic impacts. Oliver Waack-Jürgensen of the Berlin Cannabis Club High Ground said: ‘The situation with the authorities is totally unclear.’ Some opponents and public health professionals have offered words of caution, pointing to an increase in negative health effects in US states that have experimented with legalisation. But most of the cases of cannabis use disorder seem to be linked to a drastic increase in potency of products. That’s certainly something to be aware of, but also something that smart regulation can tackle ahead of time. In Germany, where possession and cultivation of cannabis was legalised for recreational use in April, the medical journal the Lancet noted recently that the country’s non-profit sales model is unlikely to result in an increase in cannabis use and related health problems that have been observed in North America – where products with overly high levels of THC are mainly a result of letting growers, manufacturers and sellers go wild. Germany’s Cannabis Act has been described as “the dawn of a new era for cannabis policy in Europe”. Isn’t it time that France woke up to the economic benefits of a new approach? Like its neighbour, France could craft its own safer and more profitable approach to help plug the hole in the state’s finances. https://www.theguardian.com/commentisfree/2024/nov/27/france-cannabis-consumption-europe-tax-decriminalisation-crime?fbclid=IwY2xjawHOf5RleHRuA2FlbQIxMQABHav0jsnzV6i2VYxo43OS6Pa8IRaG2RstxkxAI4SPl-RV5f7IzEpxqD_iEA_aem_lXGDUwTMM4B684oPx_u3cA
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