Representatives of the cannabis industry are ramping up their lobbying efforts on Capitol Hill, urging lawmakers to take action on taxes that affect their industry.
The main request in meetings with members of Congress this week: overturning a regulation that prevents legal cannabis companies from deducting operating expenses.
Members of the industry have been disappointed that the GOP tax overhaul passed in December did not clear away the regulation. And while many don’t expect legislative action this year, given the fall midterm elections, industry advocates are holding out hope for Democratic-sponsored bills that could see movement in 2019.
In terms of taxes, the main legislation the cannabis industry is supporting is the Small Business Tax Equity Act. The legislation targets a line in the tax code, put in place in 1982, that prohibits businesses from deducting a broad array of expenses if they are “trafficking in controlled substances.”
That means that companies operating legally in states that allow recreational or medicinal marijuana get stuck with a far higher federal tax bill than other businesses.
See the original article at The Hill