The best of times, the worst of times.
The cannabis industry has seen big swings in the past year.
On the other hand, Nevada introduced a very successful adult marijuana program in July. California began its recreational sales in January, and Florida is preparing to start selling drugs. Massachusetts and Canada are expected to start selling adult products later this year. The industry is expected to have an economic impact of $40 billion by 2021, according to estimates from ArcView market research.
On the negative side, the attorney general, Jeff sessions, canceled the Cole memo, which provides protection from federal interference for states that sell legal marijuana. Voters in Maine approved the sale of recreational marijuana to adults, but the governor rejected the measure. Federal law effectively prevents marijuana companies from using normal banking services, forcing billions of dollars of industry to operate in cash.
Here are some of the key issues that marijuana supporters want congress to address.
The banking sector
The legal cannabis industry continues to operate primarily as a pure cash business. Because of the illegal activities at the federal level, Banks will not extend services to those who work in marijuana. This is a bad long-term situation that leads to tax penalties and security issues.
The cryptocurrency and blockchain are expected to alleviate the problem, but the company does not have cash to replace it. Federal and state governments have put forward various Suggestions (California officials have talked about creating a state-run Banks to deal with the hemp industry), but so far there have been no specific solutions.
The federal tax code allows businesses to do whatever business is expected – deducting wages, supply costs, and rents. Companies can’t do that.
This is because the “internal revenue code” section 280E prohibits the deduction of the normal business expenses of any business “selling illegal schedule I or schedule II material”. Under federal law, marijuana remains an illegal drug in schedule I. The NCIA reports that some marijuana companies are effectively paying 70 percent tax. This is what they want to see change.
To protect the
The meeting’s efforts to eliminate the cole memo include both consumers and, in particular, marijuana companies worried about potential federal efforts to crack down on marijuana growers and sellers. When and where it can happen, or even what happens, in addition to making uncertainty more uncertain.
Massachusetts lawmakers have moved to ban state law enforcement from helping any federal government crack down on the state’s legal marijuana business. Vermont democratic senator Patrick lech also introduced a provision to protect medical marijuana users across the country from federal interference.