Drug Tax Ruled Unconstitutional By Texas Appeals Court

A state law meant to penalize drug dealers by making them pay taxes on confiscated drugs violates constitutional guarantees against double jeopardy, the Texas Court of Criminal Appeals ruled Wednesday. The decision is similar to a 1995 Arizona ruling that prohibited an individual who possessed marijuana from criminal prosecution “because the tax imposed prior to the prosecution served a punitive purpose.”

Lawyers involved in the case said the 5-4 decision means the state can either impose a drug tax or prosecute an individual for illegal activity; it can’t do both. “This [ruling] means the state only gets one chance to punish you,” said Tom Moran, a Houston attorney representing the defendant.

The decision could lead to the review of nearly 1,000 of drug cases in which both criminal penalties and taxes were assessed. In cases which all or some of the state drug tax has been paid, this ruling could be “a pretty good get-out-of-jail-free card,” said Dan McCrory, an assistant district attorney for Harris County. A spokesman for the state comptroller’s office told the Dallas Morning News that counties had referred over 9,000 cases to their offices for collection of the drug tax.

In the recent decision, the court found that Texas’ $98 tax on an ounce of marijuana and $200 per gram of controlled substance was so high as to conclude, “it … is a penalty for criminal conduct.” Therefore, the court ruled that because the defendant had already been punished by “imposition and partial collection of a tax,” further prosecution would violate his Fifth Amendment protections against double jeopardy.

The case had initially been denied by Texas courts, but the U.S. Supreme Court ordered the state courts to reconsider based upon a 1994 Supreme Court ruling on double jeopardy. In that case, Department of Revenue v. Kurth Ranch, the Supreme Court ruled that to collect a tax on the possession of drugs from defendants who had already been charged, convicted, and sentenced on criminal charges involving the same drugs was the functional equivalent of a successive criminal prosecution.

For more information, please contact Allen St. Pierre of NORML at (202) 483-5500.