Last week in cannabis legislative news, senators continued examining national banking laws that prohibit marijuana companies from accessing financial institutions, California attempted to lower cannabis taxes in order to dampen the black market, and Maryland considered legalization. Find out more in our weekly marijuana legislative roundup.
On Thursday, Senators Lisa Murkowski (R-AK) and Jeff Merkley (D-OR) introduced a new provision within the Secure and Fair Enforcement Banking Act that would prohibit the federal government from punishing financial institutions for providing or having provided banking services to state-legal marijuana businesses. The SAFE Banking Act, introduced last year, includes a number of provisions designed to ensure banking access for cannabis businesses in states that have legalized the plant for recreational or medical use.
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Banks have been wary of providing services to cannabis businesses due to the potential of violating federal law, under which the plant remains illegal. This has forced many marijuana businesses to operate in cash, causing a security issue as they make prime targets for robbery. The Treasury Department under Obama issued guidelines for banks to provide services to cannabis businesses in conjunction with the guidelines in the Cole Memo, but this has been thrown into question following the rescission of the Cole Memo by Attorney General Jeff Sessions in January.
On Thursday, a bill was introduced in the California Assembly that would drastically reduce the state’s hefty taxes on marijuana in an effort to encourage consumers to purchase from legal retailers rather than the black market. Retailers have complained that the high taxes, which approach 50 percent in some places, have caused many to resort to purchasing from the cannabis black market that has thrived in California for decades. California currently imposes a $9.25 cultivation tax on each ounce of marijuana buds and a 15 percent excise tax on cannabis sales, on top of the state’s 10 percent sales tax and any additional sales taxes imposed at the local level.
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San Francisco city officials last week announced that they will begin issuing permits for marijuana lounges or “cafes” once regulations are put in place to prevent secondhand smoke exposure and excessive odor in city neighborhoods. California is the only state that allows specially-licensed retailers to operate Amsterdam-style social-use lounges on their premises, where patrons can smoke and otherwise consume marijuana in a public setting. Denver recently approved its first social-use license to a local coffee shop, but smoking is not allowed.
On Tuesday, the Maryland House Judiciary Committee held a hearing on a proposal to place a marijuana legalization question on the ballot in November. If approved by a three-fifths majority of both houses of the legislature, voters would be asked whether possession and cultivation of small amounts of cannabis should be legalized for adults 21 and older in the state. The state would also be required to come up with a taxation and regulatory system for recreational cannabis.