The State Tax Commission hasn't sold many drug stamps to illegal narcotics traffickers.

But that doesn't mean the state's new "stamp act" is a failure. In fact, the Tax Commission is wildly enthusiastic about the new law.In the first four months the law has been in effect, the Tax Commission has used the stamp act to issue $4.2 million in tax assessments against drug dealers who didn't have the drug stamps.

In many cases, the stamp act has meant financial ruin for drug dealers.

"It's getting to be a popular tool for law enforcement," said Richard Strong, director of the Division of Collections. "Law enforcement officers get frustrated with a court system that doesn't hit drug dealers as hard as it should, and they see this as a tool to hit drug dealers harder."

The 1988 Legislature passed a law requiring drug dealers to purchase stamps for their illegal booty. The stamps cost $3.15 per gram for marijuana, $200 an ounce for cocaine and $2,000 per unit for hard drugs and pills.

Since the law went into effect April 1, the Tax Commission has sold 515 marijuana stamps, presumably to tax collectors, Strong said. No cocaine stamps or stamps for hard drugs have been sold.

Failure by drug dealers to possess the drug stamps when they are arrested results in a tax assessment by the State Tax Commission against the drug dealer in direct proportion to the amount of drugs he or she has in possession or has been selling to undercover narcotics officers.

"And then we add a 100 percent fraud penalty on top of that," said Strong. "They're pretty shocked when we come in and start seizing all their assets."

The state has always had a forfeiture law in drug cases, but that law only allowed lawmen to seize assets purchased with drug money or used in drug transactions. The new state stamp act allows the state to seize all assets of a drug dealer, regardless of whether or not they were used in drug deals.

"We look at it as back taxes, not whether it was something purchased with drug money," said Strong.

For example, if a drug dealer is arrested with 100 ounces of cocaine, the Tax Commission computes the taxes on that 100 ounces as $20,000. It also tacks on another

$20,000 fraud penalty, after which it seizes $40,000 in personal or business assets.

Most of the $4.2 million assessments made thus far are tied up in litigation. The state keeps the assets in storage until a hearing before the Tax Commission is held.

"It wipes them out financially," said Strong. "And then we have the option of also hitting them with back sales tax and income tax they haven't paid."

Violating the stamp law is a felony in addition to the narcotics charges, though prosecutors have yet to charge any drug dealers with that offense.

Strong emphasized the Tax Commission does not become involved in narcotics investigations. Rather, commission investigators come into the case after narcotics officers have made arrests.

The majority of Tax Commission drug cases have been in Davis County, where the commission has a good working relationship with the local law officers. While the Tax Commission is willing to work with officers anywhere in the state, some areas, like Salt Lake County, haven't used the Tax Commission's resources.

Strong said the Tax Commission is careful to avoid inter-agency squabbles, and it doesn't become involved in cases where it is not wanted.

After a forfeiture hearing before the Tax Commission, the assets are then sold and the proceeds are placed in the general fund. Strong would like to see the law modified so that assessments can be used to pay for drug investigations on the state and local level.

"We've got so many cases we could keep 10 people busy all the time making assessments," said Strong. Fur people are assigned to enforce the stamp act.