Deprecated: mysql_connect(): The mysql extension is deprecated and will be removed in the future: use mysqli or PDO instead in /home/a26f9f83/public_html/articles/includes/config.php on line 159
Truly Bizarre Taxes: The Tax on Illegal Drugs > NetSparsh - Viral Content you Love & Share

Truly Bizarre Taxes: The Tax on Illegal Drugs

One can never underestimate the enthusiasm that politicians have for trying to hunt up tax revenues. The creativity of some politicians can lead to bizarre taxes and unfortunate results.

Taxes on Illegal Drugs

One argument for the legalization of various narcotics is that massive tax revenues would be created. Interestingly, a few states already are trying to collect such taxes!

More than 10 states have tried to tax people that possess illegal drugs. For example, Kansas levies a drug tax on dealers as soon as they take possession of the substance. To avoid prosecution for failure to pay the drug tax, individuals possessing the drugs are supposed to purchase "drug tax stamps" and attach the stamps to the drugs in question. The stamps are valid for 3 months.

In an apparent attempt to promote compliance, the Kansas Department of Revenue promises:

"A dealer is not required to give his/her name or address when purchasing stamps and the Department is prohibited from sharing any information relating to the purchase of drug tax stamps with law enforcement or anyone else."

The tax is levied on cocaine, marijuana, methamphetamines and other hard drugs. Interestingly, the state collected over $300,000 in such taxes by going after individuals that were charged with criminal activity. This is better known as the "Al Capone Theory", which is derived from the fact that authorities were able to put away the famous mobster on tax evasion charges. Alas, criminal prosecutors have not always welcomed the illegal drug tax.

Drug Tax Foils Prosecution of Drug Dealers in Texas

The 5th Amendment of the Constitution protects Americans from being punished twice for the same crime. This concept, known as "double jeopardy", caused prosecutors in 1989 to literally beg the state comptroller's office to stop accepting tax payments by drug dealers. The reason? A Texas Criminal Court of Appeal ruled that the state law assessing taxes on illegal drugs constituted a "punishment". As a result, requiring the payment of the tax constituted double jeopardy if the taxpayer had already been charged criminally.

In an attempt to get their clients off on drug charges, criminal attorneys began advising them to rush to pay their drug?related taxes. The theory was that once the taxes were paid, the drug dealer could not be prosecuted because doing so would constitute a second punishment! The appellate court agreed with the theory and the state comptroller immediately stopped collecting the Texas drug tax.

Richard Chapo is CEO of - Obtaining tax refunds for small businesses by finding overlooked tax deductions and credits through a free tax return review.

In The News:

This RSS feed URL is deprecated, please update. New URLs can be found in the footers at


Taxes From A To Z (2018): H Is For Hobby Loss Rules
At tax time, some choices are easier than others. That form W-2, for example? That almost always means that you're an employee and you'll report that income on line 1 of your tax return. But what about that form 1099-MISC? Or that form 1099-K? It's not ...
'That's the game': Tax planners look for loopholes amid uncertainty over new lawWashington Post
This is why you shouldn't wait until the last minute to file your taxesCNBC
Drive for Uber? Deliver for Amazon? Here are tax rules to know for gig economy workersChicago Tribune
Fresno Bee -Motley Fool
all 19 news articles »


The New Tax Bill Could Unintentionally Force Sports Teams To Pay Taxes On Trades
A single word in the sweeping tax bill that House Republicans passed in December could lead to a host of unintended consequences for American pro sports teams when making trades, according to a report from Jim Tankersley in the New York Times. This ...
A small provision in the GOP tax law could soon become a nightmare for the NBA and MLBBusiness Insider
The GOP tax bill reportedly could have an impact on MLB and NBA
USA Tax Bill Reportedly Could Subject NBA, MLB Trades to Capital Gains TaxesBleacher Report

all 8 news articles »


Californians fed up with housing costs and taxes are fleeing state in big numbers
Californians may still love the beautiful weather and beaches, but more and more they are fed up with the high housing costs and taxes and deciding to flee to lower-cost states such as Nevada, Arizona and Texas. "There's nowhere in the United States ...

New York Times

A Curveball From the New Tax Law: It Makes Baseball Trades Harder
New York Times
The change of a single word in the new tax law means baseball, basketball and other sports franchises could now face capital gains taxes every time they exchange players.
Tax reform could limit baseball trades this summer | NewsCut ...Minnesota Public Radio News (blog)
Donald Trump's tax law could impact MLB trades - Yahoo SportsYahoo Sports

all 5 news articles »

New York Times

Europe's Planned Digital Tax Heightens Tensions With U.S. - The ...
New York Times
WASHINGTON — A global attempt to prevent large, multinational companies from shifting their profits to lower-tax jurisdictions is setting off a fight between the United States and Europe, as policymakers on both sides of the Atlantic spar over efforts ...

and more »

StateImpact Pennsylvania

State says PES owes $3.8 billion in back taxes, urges court hold up bankruptcy plan
StateImpact Pennsylvania
Philadelphia Energy Solutions is the largest oil refining complex on the Eastern seaboard. It filed for Chapter 11 bankruptcy in January. Pennsylvania Attorney General Josh Shapiro is urging a federal bankruptcy court to withhold approval of a ...
Pennsylvania says bankrupt refiner owes $3.8 billion in taxes: filingReuters

all 3 news articles »


The Current State of Cryptocurrency Taxes in the US
2017 was the year that digital currencies became popular and profitable. It was an exciting time as each day brought new and extravagant price hikes that brought the crypto market cap from less than $20 billion to more than $800 billion by the end of ...
4 Reasons You Might Owe Tax on BitcoinMotley Fool

all 29 news articles »

Tax Foundation

New Study Debunks European Commission Claims Justifying New Taxes on Digital Companies
Tax Foundation
At this week's meeting of G20 leaders in Argentina, one of the most discussed topics will be the taxation of digital companies. Indeed, Angel Gurría, the Secretary-General of the Organisation for Economic Cooperation and Development (OECD), will brief ...


6 tax deductions you can take without itemizing
As a taxpayer, you have a couple of choices when it comes to filing your upcoming return: You can take the standard deduction, or itemize deductions in the hopes of snagging a better deal on your taxes. If you opt for the former, you won't need to sink ...
Rev up your tax savings with these filing tipsCNBC

all 2 news articles »


Everyone Tries To Dodge The Tax Man, And It Keeps Getting Easier
Al Capone was busted for tax evasion. Leona Helmsley was, too. But gangsters and entitled millionaires aren't the only ones who hold something back from the tax man. Each year, Americans of all stripes underpay the IRS by hundreds of billions, aided by ...

and more »
Google News

Save Money on Taxes - Let Uncle Sam Pay for Your Fun!

"Deducting Meals and Entertainment"O.K. You've been working really hard on... Read More

I Havent Filed a Tax Return with IRS in Years, What Do I Do?

In elementary school, kids come up with creative excuses why... Read More

Taxation of Isle of Man Companies from April 2006

At the present time a company incorporated in the Isle... Read More

How to Check the Status of Your Tax Refund Online

So, you were pleasantly surprised to learn that you are... Read More

Organizing Your Taxes

Does this scene sound familiar? It's April 7. You haven't... Read More

Small Business Tax Issues for Self-Employed Individuals

The United States is a nation of entrepreneurs. There are... Read More

The Seven Deadly Tax Sins: Commonly Missed Deductions

It's that time again, the April 15 tax deadline is... Read More

The Tax Man Cometh... To Search

You're at your office, or home, and the doorbell rings... Read More

Some Folks Pay A Lot Less Tax Than Others On Very Same Income?Did You Pay Too Much Tax In 2004?

Someone once remarked, "Next to being shot at and missed,... Read More

Tax Deductions - Mr. C.P.A. Can I Deduct a Pizza? You Too Can Deduct Your Fun By Using Tax Tips

Recently, I stumbled across a concept that could change your... Read More

IRS Reports Tax Gap of $300 Billion

The Internal Revenue Service is reporting that the difference between... Read More

State Tax Information

All states also have their own tax system. Typically there... Read More

Taxing Overseas Firms for SOX Compliance

The Sarbanes-Oxley Act, also called the Public Company Accounting Reform... Read More

About Income Taxes; Tidbits

1812The first attempt to impose an income tax on America... Read More

How to Donate Your Car to Charity and Get Tax Deduction

Donating your used car to charity is a win-win situation;... Read More

Tax Records - What You Should Keep And For How Long

Many taxpayers are confused about how long they should keep... Read More

Save Money on Taxes - Double Your Income Now With Tax Saving Tips on Deductions

Adding Your First Additional Stream of IncomeMost new wealth builders... Read More

Uncle Sam is Ready...Are You? Organizing Tips for Tax Time

Anyone who is closely related to an accountant knows that... Read More

Are You Overpaying Taxes If You Use Tax Preparation Software?

For many business owners the answer to this quandary is... Read More

Tax Trap #3 -- IRS Penalties, Interest and Love Letters

As a small business owner or self-employed person, one of... Read More

Deducting Points On Home Refinances

Deduction of Refinance PointsAny points that you pay in the... Read More

Tax Audits: What Signs Make You More Likely to be Audited by the IRS?

It's a major fear for most Americans: A notice from... Read More

Keeping Your Own Money ? NOT Handing It Over To The Taxman

Most people trying to make a crust online (or offline... Read More

Identity Theft ? Impacting Your Taxes?

If your identity is stolen, your finances can quickly become... Read More

Amending Procedural Laws for Collection of E-taxation

The electronic transaction ordinance defines the certificated copies in which... Read More