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How North Carolina Cashes In On Illegal Drugs

The NC Department of Revenue has made more than 200 million dollars in tax revenue on illegal drugs since 1990.

GREENSBORO, N.C.-- We are used to paying taxes on things like clothes and food, but what about illegal drugs? That gets taxed, too and some drug dealers are willing to pay.

The tax is called on the Unauthorized Substance Tax.

"The idea is if we are going to say that you haven't paid the taxes there has to be a tax schedule, there has to be a way for you to pay the tax." Rik Stevens, Chief Warrant Officer for the Guilford Co. Sheriff's Office said.

Drug dealers can voluntarily pay the tax on illegal drugs before getting busted by purchasing a tax stamp from the state Department of Revenue and placing it on the drug.

It's pretty simple. A dealer fills out an Unauthorized Substances Tax Return form with an address but no name and either take it with payment in person to the office in Raleigh or mail it in. And get this, their secret is safe.

"There is actually a criminal penalty for employees of that office who would tell law enforcement who was there to buy stamps. That would seem to be a good investigative technique but the state has cut that off for us," Stevens said.

It doesn't happen very often. Since 2010, the Department of Revenue collected just under $18,000 dollars in stamp sales.

That pales in comparison to the nearly 60 million dollars the state earned by seizing the property from drug dealers, who didn't stamp their drugs.

If a law enforcement agency is involved in the seizure of drugs, they get 75 percent of the tax value of the drugs and the state gets 25 percent.

"There are a great number of regulations of how we can use that money, but it does benefit our programs for drug enforcement and all other areas of law enforcement as well," Stevens said.

The money is used to buy things like new equipment, training and squad cars. As for the state's share, that money goes back into the general fund.

Keep in mind, having a stamp on illegal drugs does not make them legal; it just stops authorities from seizing any assets you have, if you were caught.

If you are curious as to what the tax rates are, you can find that here.

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