As any rapidly growing industry can tell you, lobbyists are a necessary evil in the American political system. With medical marijuana cultivating acceptance across the United States, there are many collectives that have no place to put their legally earned green… Cash that is.
However that could all be changed if the Small Business Tax Equity Act of 2013, authored by Democratic Oregon Rep., Earl Blumenauer passes on June 5. With a handful of lobbyists and a heart full of love for medical cannabis. Several 420 activists will take the long road trip to our nation’s capital, to fire up political support for the Small Business Tax Equity Act at a press conference before the June 5 Bill introduction.
The Small Business Tax Equity Act of 2013 will amend IRS Section 280E of the tax code to resolve a crisis in the newly legal billion-dollar industry, according to Betty Aldworth with the Washington D.C. lobby National Cannabis Industry Association.
Marijuana is a federally illegal drug that 20 states have legalized for medical purposes. Two have legalized its use for adults over 21. But the Internal Revenue Service treats all marijuana-related businesses as “drug trafficking organizations” under a 30 year-old section of the tax code. The IRS routinely disallows normal tax deductions by marijuana-related businesses, effectively shutting them down with a tax bill three or four times above average. Dozens of lawful Bay Area dispensaries have been audited, resulting in back-tax assessments of tens of millions of dollars, lawyers say.
The bill’s odds seem long. Congress has passed just a handful of bills this year, Aldworth said, and efforts to amend the tax code could move slow. Then again, the I.R.S. faces withering criticism regarding the targeting of Tea Party-related groups seeking tax-exempt status. Marijuana entrepreneurs are saying ‘Welcome to the club‘, and piling on.
“We’ve been to some degree targeted by unfair application of policy,” Aldworth said. “There is a broad appetite for more complete tax code reform beyond medical marijuana.”