Court confirms legal weed should be taxed as tobacco

A ‘real’ cannabis plant, which remains illegal. It’s low-THC sibling is taxed. Keystone / Alessandro Della Bella

The Federal Administrative Court has upheld a decision by Swiss customs to tax legal marijuana leaves to the same extent as tobacco.

In its decision published on WednesdayExternal link, the St Gallen court said that “fake” marijuana – i.e. cannabis containing less than 1% tetrahydrocannabinol (THC) – was sold primarily to be smoked, and therefore should be taxed similarly to tobacco.

It thus upheld the decision taken by the Federal Customs Administration in February 2017, which stipulated that such cannabis products be bundled together with fine grain tobacco – taxed at CHF38 ($37.70) per kilo as well as 25% of retail revenue.

+ In-depth look at the renaissance of cannabis in Switzerland

The decision had been challenged by a distributor of legal cannabis, who the court said was advertising the flowers on its website in combination with smoking paraphernalia, among other items.

The decision thus rejects the complainant’s appeal but is not final; it can yet be brought before the supreme court, Switzerland’s highest court.

The decision affects only marijuana flowers, i.e. the part of the plant to be smoked, not other legal cannabis-related products.

Low-THC weed has been freely available on the market in Switzerland since 2011, and business has since boomed, with some 130 retailers registered with customs authorities in 2017.

This taxing of legal weed could benefit federal coffers to the tune of CHF30 million a year.