The Marijuana Tax Act of 1937

Instructor: Erin Krcatovich

Erin teaches undergraduate and graduate classes in Political Science, Public Policy, and Public Administration and has a PhD in Political Science.

Did you know that marijuana was legal for centuries in the United States and has only recently been criminalized? Learn about the Marijuana Tax Act of 1937.

Before the War on Drugs

Before the 1900s, most of what we think of as illegal drugs were legal in the United States. Marijuana was recommended as a medical treatment for a variety of ailments, and hemp fiber was used to make rope for ships. It was a common crop in the colonies and fairly widespread. In fact, at one point in the early 1600s, all settlers in the Jamestown colony were required to grow marijuana!

In the late 1800s, however, the public became aware of morphine additives in some medicines and a backlash against drug use began. Although marijuana was not initially regulated, with the anger over morphine addiction caused by additives, the public's attitudes began to shift. Morphine was soon after made illegal. A few decades later, marijuana followed.

Back in the day, marijuana was good for what ails you.
old time medical marijuana bottle

Marijuana Tax Act of 1937

The Federal Bureau of Narcotics Commissioner, Harry Anslinger, took on the case of making marijuana illegal. The reasoning seemed to be that addicts would move from one drug, like heroin, to others, like marijuana, in search of a legal and accessible high. To curb drug use, then, the government must make all addictive substances illegal in order to reduce abuses. Some experts opposed to this weighed in, explaining that marijuana has a lower likelihood of becoming an addictive habit, and that there are some medical benefits. Despite their protests, the Marijuana Tax Act of 1937 was passed by Congress. It had several parts:

  • Individual possession and sale of marijuana became illegal.
  • Medicinal use of marijuana was still legal, but it created a very expensive fee system to tax its use.
  • Anyone who bought, sold, imported, distributed, cultivated or prescribed it as medicine had to pay a tax.
  • Anyone who did not pay the tax could be punished by either a fine of $2,000, 5 years in prison, or both.
  • Sale of medicinal marijuana required extensive record keeping.

Technically, the Act did not make medical marijuana illegal. However, the extensive paperwork surrounding the use of it for medical research made the process basically impossible. In the administrative rules attached to the Act, you will find a very complicated process of reporting which doctors must follow, telling the federal government the names and addresses of patients who will be prescribed marijuana, as well as all relevant medical information. This and the tax must be provided immediately or the doctor and patient both face the hefty fine or imprisonment.

Another casualty of the act was industrial hemp: where once this had a lot of uses, the Act made it less economically viable to produce, import and export.

A plant of many uses
bud and leaves

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