Senator Cory Gardner (R) Colorado has authored and attached two cannabis amendments to a Republican tax bill being voted on this week. Back in the ’80s, a provision known as 280E was enacted, making sure that cannabis businesses paid much higher taxes than in other industries.
Originally the provision had the best of intentions; according to Forbes it was meant to stop drug cartels from buying expensive toys, like yachts and private islands with their drug money. Times have changed, however, and its high time that amendments like the ones Gardner introduced were given credence.
The amendments focus on taxes and do things like allow cannabusinesses to deduct normal expenses from their taxes, just like any other businesses in separate industries.
The first amendment deals with cannabusinesses qualifying for the amendment and what it entails by following state laws. Inserting an all-important period before the words, “unless such trade or business consists of marijuana sales conducted in compliance with State law.”
The second amendment is much longer and revolves around requiring that state legal cannabusinesses fulfill a certain definition of “properly regulated.” It also tackles trafficking and excludes cannabis from the ominous word.
In it, the second requirement is this:
“No cannabis or cannabis-derived materials owned by the trade or business are sold, exchanged, provided free of charge, gifted, donated, sampled, embedded in the sale of another item, embedded within the provision of a service, or otherwise transferred in a manner that does not give rise to cannabis related income.
Meaning no more dispensary freebies, giveaways or sample days. But before judging an amendment by its paragraph, remember that this is an overall good thing for the marijuana industry. Being able to file taxes by complying with state laws seems like a very fair trade.
In a press release about the bill, Gardner said, “Our current tax code puts thousands of legal marijuana businesses throughout Colorado at a disadvantage by treating them differently than other businesses across the state. Coloradans made their voices heard in 2012 when they legalized marijuana and it’s time for the federal government to allow Colorado businesses to compete. This commonsense, bipartisan bill will allow small businesses in Colorado and other states that have legal marijuana businesses to grow their operations, create jobs, and boost the economy.”