Johannes Kepler Universität Linz

03/04/2024 | News release | Distributed by Public on 03/04/2024 03:30

What Does Legalizing Cannabis in Germany Mean for Austria

A JKU tax expert shared his insight regarding the tax implications.

Professor Thomas Bieber; Credit: ORF

Prof. Dr. Thomas Bieber (Institute for Financial Law, Tax Law and Tax Policy & Research Institute for Customs and Foreign Trade Law at the JKU) commented on the planned legalization of cannabis in Germany in ORF's business magazine, ECO, opens an external URL in a new window. The law is scheduled to take effect in Germany as of April 1; how might "cannabis legalization" in Germany impact Austria?

In addition to issues relating to medical and criminal law, there is a question as to whether or not cannabis is subject to a tobacco tax. Prof. Bieber explained that while ultimately it depends on product condition, it can be assumed that cannabis buds - as "smoking tobacco" - may be subject to a tobacco tax. There have already been court rulings pointing in this direction and a tax rate of 34% of the retail price would then apply. Another decisive factor would be to set a carefully considered retail price that is neither too high nor too low. Prices considered too high could, for example, fuel a black market and result losing tax revenue. Bieber cautions: "It's a well-known and researched phenomenon in the area of legal tobacco products, such as cigarettes."

Click here, opens an external URL in a new windowto read the ECO article.