Tobacco association urges govt to legalize hash, citing blns in potential tax revenues

A new tax on hash sales could generate billions of pounds for Egypt and help solve its crippling deficit problem, the Cairo and Giza Tobacco Merchants Association argued when it submitted a proposal to the Cabinet on Sunday to legalize the drug.

Egypt's recent tax hike on various goods and services — including a sudden and widely unpopular surge in cigarette taxes — spurred the association to look into doing the same thing for hash, association head Osama Salama told Mada Masr on Monday. According to the association’s research, imposing taxes on hash sales could generate LE4.2-5 billion in state revenues per year.

“And that’s only if you impose a 10 percent tax,” Salama added.

Hash has been illegal in Egypt since the country became party to the League of Nations’ Geneva International Convention on Narcotic Control in 1925, but trade in the illicit drug has consistently remained robust, according to Salama. With potential profits in mind, “we raised a proposition to the legislative authority to make it legal,” he said.

The proposal could potentially prompt Egypt to join its neighbors Lebanon and Morocco in considering economic-motivated legislation that would either legalize the cannibas and hash trade, or at least provide amnesty to growers. Decriminalization bills have been considered by both of those governments in recent years, and the debate there remains ongoing.

In its capacity as part of the civil society sector, the association hopes to bring the authorities’ attention to any potential revenue generators, even those that are currently illegal, Salama continued.

“They can use this amount for the education sector, for infrastructure, or however they please,” Salama said.

The association immediately elicited controversy when it went public with the bill on Sunday, which was ridiculed and criticized on several talk shows that night. On her talk show “Hona al-A’sema,” anchor Lamis al-Hadidi said such a proposal would only contribute to increasing the number of drug users in Egypt.

“If anything, we need to sober up,” she said. “We need to focus and start working.”

Salama lamented the uproar, saying critics like Hadidi are looking at legalization from a moral standpoint, when it’s actually a “scientific and economic” issue.

“Either way, we only care about the street and the government’s opinion,” he said. “We want them to seriously consider and look into it.”

In a statement on its Facebook page, the association urged the state to use the “forbidden fruit” rule, explaining that demand would decline if hash was legal and widely available.

Furthermore, the state currently spends more than LE1 billion a year in its fight on drugs, instead of profiting from what could be an LE42 billion industry, the association said, basing its figures on an analysis of official reports and an estimate of the hash trade in Egypt. The association estimated that there are some 40-45 million users across the country.

In addition to generating revenues from taxes, legalizing hash would allow Egypt to ramp up production and compete on the international market with leading regional exporters, such as Morocco, Lebanon and Afghanistan, the statement continued. Hash products can be used in alternative medicines, including as part of cancer treatments, Salama continued.  

Finally, legalizing the drug would also alleviate the burden on the general intelligence services, Armed Forces and security personnel, the statement argued, and allow them to focus their efforts on national security.