Pubdate: Thu, 07 Jul 2005
Source: Tennessean, The (TN)
Copyright: 2005 The Tennessean
Contact:  http://www.tennessean.com/
Details: http://www.mapinc.org/media/447
Author: Amber North, Staff Writer,  http://www.mapinc.org/pot.htm (Cannabis)
Bookmark: http://www.mapinc.org/coke.htm (Cocaine)
Bookmark: http://www.mapinc.org/meth.htm (Methamphetamine)

TAXES ON ILLEGAL DRUGS PAY OFF FOR STATE

Money Being Taken From Some Innocent People, Defense Attorneys Say

Tennessee modeled its program to collect taxes on illegal drugs after 
North Carolina's, but early returns indicate that the Volunteer 
State's 6-month-old effort has been more successful.

A report released yesterday showed that Tennessee had collected about 
six times more taxes on controlled substances as did its neighbor to 
the east in its first six months. Substances taxed include cocaine, 
crack, methamphetamine and marijuana.

The 10-person unit of the Tennessee Department of Revenue reported 
that it had collected $606,687 and assessed more than $15 million. 
The department has spent $376,400 since the program began in January.

North Carolina's Department of Revenue collected $107,000 in the six 
months after its program began in January 1990.

"I will say we've exceeded our expectations, based on what North 
Carolina did in their first six months," said Emily Richard, 
Tennessee Department of Revenue's spokeswoman. "I feel like it was a success."

Ron Starling, director of North Carolina Department of Revenue's 
unauthorized substance tax division, said the year ended June 30 was 
its most successful; $9,349,533.55 was collected, nearly a million 
more than last year, bringing its 15-year total to almost $90 million.

The tax also applies to illicit alcoholic beverages, such as untaxed 
liquors and spirits. It applies to dealers who possess illegal 
substances, and the tax is payable within 48 hours of the dealer 
acquiring the substance.

Despite Tennessee's success with the new tax, some defense attorneys 
think that some people being taxed are not guilty of drug possession.

"I don't have a problem with money being taken from people who are 
proven to be involved in some sort of illegal conduct," said Erik 
Herbert, a Nashville defense attorney. "The issue that I have are 
these liens and monies being taken before it's proven people have 
done anything wrong."

Herbert represented Michael Garcia, who was ordered to pay $17,592 in 
taxes in April after being stopped as he followed a vehicle going 
through Springfield. Authorities said the other vehicle was carrying 
10 pounds of marijuana, and police said they suspected that Garcia 
was running interference for a drug dealer.

Garcia was never arrested or charged.

Last week a state revenue department lawyer waived the assessment, 
saying there wasn't enough evidence to prove Garcia possessed the drugs.

Herbert said Garcia probably isn't the only innocent person who was 
assessed the tax.

"If you've got financial resources, you can go out and hire an 
attorney to represent you and potentially convince the Department of 
Revenue" to waive the tax, he said. "But there are thousands of 
people out there that don't have resources to test this and will have 
property taken from them or liens. There's no judicial oversight to 
make sure this is done properly."

Richard, the Revenue Department spokeswoman, said officials expected 
such criticisms.

"There are some of these challenges that have been filed, and we 
expected them," she said. "We're implementing and executing a law 
that was enacted by the General Assembly."
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