Puerto Rico: November Shock for Leisure Hashish?

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Puerto Rico: November Surprise for Recreational Cannabis?

Charlie Delgado Altieri, the main opposition candidate for the governor of Puerto Rico, has proposed a new tax on hemp and medicinal cannabis to settle the bill for state pensions amid a protracted financial crisis on US territory.

According to Delgado, such a levy would be justified given the billions in revenue generated by the cannabis industry. According to Delgado, representatives of the cannabis industry he has met are generally open to the idea, with some having come up with counter-proposals. It is possible that this spirit of compromise was due in part to Delgado's indications that he would take steps to make recreational cannabis use possible in Puerto Rico. As they say in Puerto Rico, to get part of the chest, one has to give up part of the wing.

Delgado doesn't seem like a passionate advocate of legalization, but a government he leads could be Puerto Rico's best effort to legalize recreational cannabis legalization. The break between Delgado's Democratic People's Party (PPD) and the ruling New Progressive Party (PNP) consists mainly in political status preferences (continuation of the territorial status quo vs. statehood). Nonetheless, the partisan split shows some elements of a left-right split, both financially and socially.

In general, the PPD is more comfortable advocating for social liberal issues like LGBT rights. It was the last popular governor, Alejandro García Padilla, who got the legalization ball rolling and passed an executive order authorizing medical cannabis use. In contrast, the ruling New Progressive Party (PNP) has major socially conservative constituencies (although some of its key leaders at the national level agree with Democrats, including 2020 gubernatorial candidate Pedro Pierluisi). And it was a PNP government that passed laws legalizing medical cannabis a few years after García Padilla's executive order.

However, recreational cannabis seems to be a bridge too far for some of the party believers.

What stems from an economic divide is also evident in the debate over Delgado's cannabis proposal. The PNP lawmakers rejected the plan, suggesting that taxes were the "solution for everything" of the PPD. That may be a political exaggeration, but Delgado's views on cannabis are clearly shaped by its potential to generate additional government revenues. Delgado discussed a possible legalization of recreational cannabis and stressed that any proposal must enrich the public purse.

While any steps towards further legalization would be welcomed, Delgado should view the cannabis industry as a growth driver rather than the government's piggy bank. The success of the industry will result in higher tax revenues, but cannabis can and should mean a lot more to Puerto Rico. If the government just stands at the checkout and waits for it to be cut, rather than giving industry room to grow, it will hurt its potential for job creation.

As for the PNP, concern for hemp and medicinal cannabis users as taxpayers is laudable – but if their leaders are really concerned with improving the lot of Puerto Ricans, they should be firm behind the legalization of recreational and economic cannabis Upswing that this would certainly bring about. Furthermore, a well-regulated cannabis industry would mimic what is happening in many US states – something that should resonate with a party advocating statehood.