It means exactly what it says.
Many US States have laws requiring you to buy and affix a tax stamp onto any marijuana you possess. . .even (and especially) if you possess it illegally.
How can they make you pay tax on weed that is otherwise still illegal? Good question. That doesn't make any sense to me either, but its my understanding that this concept has been put to legal review in at least a few of the states in question, and judges have ruled that merely paying the tax on illegal marijuana doesn't make it legal.
The most important implication of this is the bit about "fine".
If you're caught in possession of marijuana, the State might not be able to prove its CRIMINAL case against you beyond a reasonable doubt, which is a pretty high legal burden to meet. But if the State can prove a civil TAX case against you with preponderance of the evidence (a much lower legal standard) then they can still fine you up the wazoo for possession of untaxed marijuana.
jayy's
