Legalising the production and sale of cannabis could bring in up to £2.5 million in tax revenue for Manx coffers.

That is the claim from Ramsey MHK Dr Alex Allinson (Ramsey), who has advocated the legalisation of the drug and also for the Isle of Man to consider producing and exporting it.

He said that, using the same template as was used to measure potential tax revenue if the drug was legalised in the UK, the amount of money raised come be between £500,000 and £2.5 million.

Dr Allinson said: ’The Institute of Economic Affairs recently produced a document estimating that in the United Kingdom up to £690 million could be attained through a 30% tax on cannabis, if it was legalised.

’Using their calculations, I can estimate that between £0.5 million and £2.5 million could be raised in the Isle of Man based on the same calculations.’

He added: ’Government legislates and regulates a whole range of human activities going from drinking alcohol, smoking cigarettes to gambling.’

He said that while legalising cannabis could produce revenue, it could actually increase safety, while tax revenue could be ’recycled’ and used for education.

In Tynwald on Tuesday, Dr Allinson asked Treasury Minister Alfred Cannan whether he thought the government should be ’looking at ways of diversifying our economy and increasing tax revenue’.

Mr Cannan said he was always keen to look at ways to diversify the economy but added: ’Clearly the line that the member is taking is a complex one, full of many pot-holes along the road in different directions and I don’t want to make a hash of this answer.’

The first pun may have been inadvertent, but the minister appeared to be playing up to the laughter it caused, with the second and subsequent plays on words.

’In all seriousness not only are we talking about potential tax revenues, we are also talking about import/export regulations,’ he continued.

’We are also talking about agreements with the United Kingdom. We are talking about VAT implications. There is a huge amount to discuss.

’Dare I say it, any decision would have to be a joint decision amongst many parties in order to get progress on this.’

Mr Cannan also pointed out that the Isle of Man ran on a low-tax policy, effectively 0%, 10% and 20%.

’One would have to assess what kind of policy would need to be applied in order to gather in the type of revenues that the member is alluding to.’

Recently Home Affairs Minister Bill Malarkey announced plans to look into the possibility of decriminalising minor cannabis possession.

He told Tynwald, however, that any such consideration would have to follow a review of ’the evidence for the clinical effectiveness of cannabis for medicinal use, drawing on the experience of other jurisdictions’.

He explained: ’Any review on the current legislation in relation to cannabis possession will not be undertaken until after the review on medicinal use is completed.’

However, he added: ’I do personally believe we need to ensure we are not criminalising people for the possession of small amounts of cannabis.’