TAXATION OF MARIHUANA
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FRIDAY, APRIL 30, 1937

House of Representatives,
Committee on Ways and Means
Washington, D.C.

The committee met at 10 a.m., Hon Robert L. Doughton (chairman) presiding.

The Chairman: The committee will be in order. Yesterday the chairman was informed there was some disagreement in connection with some provisions of the bill, by people engaged in the processing of seed or some objection to parts of the bill we have under consideration.

The chairman suggested to Mr. Hester that he have a conference with the people representing that industry to see if it was possible to reach an agreement and remove the objection they had by some change or modification of the bill, but which would warrant them in withdrawing their objection.

Mr. Hester, has there been any development in that direction or any progress made?

ADDITIONAL STATEMENT OF CLINTON M. HESTER, ASSISTANT GENERAL COUNSEL, OFFICE OF THE GENERAL COUNSEL FOR THE DEPARTMENT OF THE TREASURY

Mr. Hester: Yes, sir. We had an extended conference with these gentlemen yesterday, and they are both here this morning, and I think they would like to be heard for a moment.

The Chairman: If they will come forward, we will be glad to hear any statement they care to make.

STATEMENT OF RAYMOND G. SCARLETT, REPRESENTING WILLIAM G. SCARLETT &;CO., BALTIMORE, MD.

Mr. Scarlett: Mr. Chairman. I might say there are only two representatives of the seed industry here today, because it so happens that our trade association, which represents 90 percent of the seed dealers in the country, is now in session in chicago, and one of the things in which they are engaged is the drafting of suggestions for provisions for the Federal regulation of seed, and our counsel could not be here for that reason.

We handle a considerable quantity of hempseed annually for use in pigeon feeds. That is a necessary ingredient in pigeon feed because it contains an oil substance that is a valuable ingredient of pigeon feed, and we have not been able to find any seed that will take its place.

If you substitute anything for the hemp, it has a tendency to change the character of the squabs produced; and if we were deprived of the use of hempseed, it would affect all of the pigeon producers in the United States, of which I understand there are upwards of 40,000.

The Chairman: Does that seed have the same effect on pigeons as the drug has on individuals?

Mr. Scarlett: I have never noticed it. It has a tendency to bring back the feathers and improve the birds.

We are not interested in spreading marihuana, or anything like that. We do not want to be drug peddlers.

But it has occurred to us that if we could sterilize the seed there would be no possibility of the plant being produced from the seeds that the pigeons might throw on the ground.

The Chairman: If you were permitted to use this seed for that purpose, and it was sterilized, would that eliminate your objection?

Mr. Scarlett: Yes, sir, that is the agreement we have reached with the Treasury representatives of with Mr. Hester's committee.

Mr. Thompson: What is the process of sterilization?

Mr. Scarlett: The germination in the seed can be killed by the application of heat and moisture.

Mr. Thompson: By the use of steam?

Mr. Scarlett: They have regular bins in which they put it and they run temperatures up to a certain number of degrees and leave the seed there for a certain period, and that kills all of the germinative powers in the seed.

The Chairman: By heating it?

Mr. Scarlett: Yes, sir. There has been an amendment proposed to section 1 (b) by excluding from the definition of marihuana sterilized seed which is incapable of germination, so that section 1 (b), as so amended, would read as follows:

The term "marihuana" includes all parts of the plant Cannabis sativa. L., whether growing or not: the seeds thereof: the resin extracted from any part of such plant: and every compound, manufacture, salt, derivative, mixture, or preparation of such plant, its seeds or resin: but shall not include the mature stalks of such plant, oil, or cake made from the seeds of such plant, any compound, manufacture, salt, derivative, mixture, or preparation of such mature stalks, oil, or cake, and the sterilized seed of such plant which is incapable of germination.

To that exception we agree.

The Chairman: Suppose it should develop that in your efforts to sterilize the seed you should not be successful, and that the same conditions existed in the seed as exist in its present form, and that those conditions would continue, then would you object to legislation necessary to protect the people from the deleterious effects of this drug?

Mr. Scarlett: No, sir; but that could be very easily accomplished, because at the present time the seed industry is under the jurisdiction of the Department of Agriculture. When we import any seed, such as clover, for instance, the Federal law provides that the imported seed must be in such a condition that it will keep out injurious weeds, so we will not get any seed that will produce this plant.

The Chairman: Did you discuss with Mr. Hester the question as to what would be the procedure in the event experience should demonstrate that you could not be successful in what you propose to do?

Mr. Scarlett: If we cannot prove that the seed is sterilized, after the Treasury representatives have taken tests of the seed, they do not have to release it.

We are willing to leave the seed under their jurisdiction until it can be proved to their satisfaction that it has been sterilized.

Mr. Cooper: I am sure you appreciate the fact that this is a highly technical phase of the question that you are discussing; that is true is it not? The treatment of seed and the elimination of injurious elements that may appear there is rather technical in its nature is it not?

Mr. Scarlett: We do not consider it very technical, because it is an accepted fact that the germination quality would be destroyed by heat.

Mr. Cooper: It is technical in that it requires expert treatment in handling, does it not?

Mr. Scarlett: If you take a sample seed and put it on your window sill or over your radiator and leave it there for any length of time, the germinative qualities will be killed.

Mr. Cooper: That is all right, but it takes somebody who knows his business to know that, does it not? I would not know how to do it.

Mr. Scarlett: All you have to do is to put a container with seed in it on the radiator and leave it there for a while and the germinative qualities will be killed.

Mr. Cooper: It requires some technical knowledge and experience to give it proper treatment, does it not?

Mr. Scarlett: It requires the application of heat. It does not require any technical knowledge to apply the heat.

Mr. cooper: But it takes somebody who knows his business, and who knows something about seed and plants to know what treatment is required, does it not?

Mr. Scarlett: Yes, sir.

Mr. Cooper: That is what I am getting at.

In view of the fact that there is a technical element involved, do you not think it would be helpful if you would advise with the officials of the Government who have training and knowledge in reference to this subject to see whether a proposal such as you have made can be worked out?

Mr. Scarlett: I have done so. I talked with Mr. Edgar Brown of the Bureau of Plant Industry, and he informed me that it can be done.

Mr. Cooper: Have you conferred with Mr. Hester and other representatives of the Treasury Department here?

Mr. Scarlett: We have, sir.

The Chairman: Before you came in, Mr. cooper, I Stated that I had requested Mr. Hester yesterday to have a conference with these other gentlemen representing the industry, to see whether or not they could reach an agreement, and he advised me that they had done so. This gentleman is explaining the proposed amendment, and Mr. Hester will later explain the nature of the agreement that they reached and the amendment that is proposed.

Mr. Disney: What is the relation between hempseed and marihuana?

Mr. Scarlett: Until Monday of this week we did not know there was any connection between the two. When this bill came out and we saw that it was called a bill to impose an occupational excise tax upon dealers in marihuana we paid no attention to it. Nobody in the seed trade refers to hempseed as marihuana.

Hempseed is a harmless ingredient used for many years in the seed trade. they say that hemp and marihuana are one and the same thing, but it was not until Monday that we knew they were.

Mr. Disney: That is as far as the trade is concerned?

Mr. Scarlett: Yes, sir. The trade at large do not know that this bill under consideration contains any provision affecting them, because the title of the bill would give them no knowledge that it was hempseed that was under discussion.

Mr. Reed: I want to get it clearly in my mind that this marihuana and the ordinary hemp that we hear about are the same thing. The plant is the same?

Mr. Scarlett: Yes, sir.

Mr. Reed: There is no difference?

Mr. Scarlett: No, sir; that is, to my knowledge.

Mr. Reed: Can anybody answer that question?

Mr. Hester: That is right.

Mr. Disney: Do you mean field hemp?

Mr. Reed: Yes; I am talking about field hemp. I want to get that clear.

The Chairman: Is not one a manufactured product and the other the substance from which it is made? The hempseed is the substance from which the marihuana is produced, is it not?

Mr. Scarlett: No, sir; marihuana is produced from the resin of the female flowers or blossoms.

The Chairman: It comes from hempseed?

Mr. Scarlett: Yes, sir; but in India when they produce marihuana, they are very careful to go through the fields and pick out the male plant, so that they will not fertilize the female plant.

The Chairman: If you had no hemp weed, you would have no marihuana, would you?

Mr. Scarlett: That is correct; that is the reason I said we would sterilize the seed.

Mr. Reed: Several people have talked to me about marihuana and they have impressed me with the fact, that they are different plants. I think that ought to be cleared up in the public mind, so that we may know we are dealing with hemp. It appears that it is grown in back yards, but I suppose a good many people have the idea that it is some sort of new species of plant in this country.

Mr. Disney: Down in our part of the country I understand marihuana grows everywhere, just as an ordinary weed. I would like to get a clear understanding on that.

Mr. Reed: In other words, it is hemp growing wild, is it not?

Mr. Disney: I do not know.

Mr. Reed: There seems to be quite a good deal of confusion about it, and the newspapers are publishing stories about it, and we might as well clear up that situation and say that we are not dealing with the ordinary hemp plant, wild or cultivated, if that is right.

Mr. Hester: That is right.

The Chairman: Is there any one else who desires to be heard?