HSB 55 (LSB 1209DP (2) 85)

SENATE/HOUSE FILE _____

BY  (PROPOSED GOVERNOR’S OFFICE OF DRUG CONTROL POLICY BILL)

A BILL FOR

An Act relating to the excise tax on unlawful dealing in certain substances by adding new taxable substances and tax rates, modifying the taxation and rates of currently taxable substances, and making penalties applicable.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 453B.1, subsection 3, paragraph a, Code 2013, is amended by adding the following new subparagraphs:
   NEW SUBPARAGRAPH.  (5)  One or more grams of an imitation controlled substance or a controlled substance listed in section 124.204, subsection 4, paragraph “ai”, or subsection 6, paragraph “i”.
   NEW SUBPARAGRAPH.  (6)  One or more dosage units of an imitation controlled substance or a controlled substance listed in section 124.204, subsection 4, paragraph “ai”, or subsection 6, paragraph “i”, which is not sold by weight.
    Sec. 2.  Section 453B.1, Code 2013, is amended by adding the following new subsection:
   NEW SUBSECTION.  6A.  “Imitation controlled substance” means the same as defined in section 124A.2.
    Sec. 3.  Section 453B.1, subsection 10, Code 2013, is amended to read as follows:
   10.  “Taxable substance” means a controlled substance, a counterfeit substance, a simulated controlled substance,
 
an imitation controlled substance, or marijuana, or a mixture of materials that contains a controlled substance, counterfeit substance, simulated controlled substance,
 
imitation controlled substance, or marijuana.
    Sec. 4.  Section 453B.4, Code 2013, is amended to read as follows:
   453B.4  Measurements.
   For purposes of measurements under this chapter, the weight of a taxable substance shall be measured by its weight in metric grams in the dealer’s possession. If a taxable substance consists of a mixture containing both marijuana and another substance or combination of substances listed in the definition of taxable substance in section 453B.1, the taxable substance shall be taxed under section 453B.7, subsection 2, unless the mixture contains a taxable substance listed in section 453B.1, subsection 3, paragraph “a”, subparagraph (5), in which case the taxable substance shall be taxed under section 453B.7, subsection 5.
    Sec. 5.  Section 453B.7, Code 2013, is amended to read as follows:
   453B.7  Tax imposed —— rate of tax.
   An excise tax is imposed on dealers at the following rates:
   1.  On each gram of processed marijuana, or each portion of a gram, five
 
eight dollars.
   2.  On each gram or portion of a gram of any taxable substance sold by weight other than marijuana, two hundred fifty
 
an imitation controlled substance, or a controlled substance listed in section 124.204, subsection 4, paragraph “ai”, or subsection 6, paragraph “i”, four hundred dollars.
   3.  On each unprocessed marijuana plant, seven hundred fifty
 
one thousand two hundred dollars.
   4.  On each ten dosage units of any taxable substance, other than unprocessed marijuana plants,
 
an imitation controlled substance, or a controlled substance listed in section 124.204, subsection 4, paragraph “ai”, or subsection 6, paragraph “i”, that is not sold by weight, or portion thereof, four
 
six hundred
 
forty dollars.
   5.  On each gram or portion of a gram of an imitation controlled substance, or a controlled substance listed in section 124.204, subsection 4, paragraph “ai”, or subsection 6, paragraph “i”, that is sold by weight, one thousand two hundred dollars.
   6.  On each dosage unit of an imitation controlled substance, or a controlled substance listed in section 124.204, subsection 4, paragraph “ai”, or section 6, paragraph “i”, that is not sold by weight, or portion thereof, one thousand two hundred dollars.
EXPLANATION
   This bill relates to the excise tax on unlawful dealing in certain substances.
   The bill adds imitation controlled substances, as defined in Code section 124A.2, to the list of taxable substances and rates in Code section 453B.7, and amends the definition of “dealer” to include a person who ships, transports, or imports into this state or acquires, purchases, possesses, manufactures, or produces in this state one or more grams or dosage units of an imitation controlled substance.
   The definition of “dealer” is also amended to lower from seven grams or 10 dosage units to one gram or one dosage unit, the threshold at which a person is labeled a “dealer” if that person ships, transports, or imports into this state or acquires, purchases, possesses, manufactures, or produces in this state a controlled substance listed in Code section 124.204, subsection 4, paragraph “ai”, (certain hallucinogenic substances), or subsection 6, paragraph “i”, (certain stimulants).
   The bill amends the rates of tax on dealers to tax imitation controlled substances and the controlled substances listed in Code section 124.204, subsection 4, paragraph “ai”, (certain hallucinogenic substances), and subsection 6, paragraph “i”, (certain stimulants), at $1,200 per gram or dosage unit, and increases the other rates of tax as follows: On each gram of processed marijuana, from $5 to $8; on each unprocessed marijuana plant, from $750 to $1,200; on each gram of all other taxable substances, from $250 to $400; and on each 10 dosage units of all other taxable substances, from $400 to $640.
   The bill also amends Code section 453B.4 to require that any mixture of taxable substances containing an imitation controlled substance or a controlled substance listed in Code section 124.204, subsection 4, paragraph “ai”, (certain hallucinogenic substances), and subsection 6, paragraph “i”, (certain stimulants), shall be taxed at $1,200 per gram instead of $400 per gram.
   Under current law, dealers who violate Code chapter 453B are subject to the tax imposed in the Code chapter and a penalty equal to the tax. In addition, dealers who possess taxable substances without a tax stamp or who create counterfeit tax stamps or possess a previously used or expired tax stamp are guilty of a class “D” felony. A class “D” felony is punishable by confinement for no more than five years and a fine of at least $750 but no more than $7,500.