Month: September 2018

Dear Members of the Vermont Marijuana Commission:

It was a privilege to serve as co-author of the RAND Report, Considering Marijuana Legalization: Insights for Vermont and Other Jurisdictions, http://www.rand.org/pubs/research_reports/RR864.html, and as the only attorney and tax person to do so.

I would be delighted to try to come to speak with you if you would be willing to hear me. In any event, here are the four main points I would make.

1.  Taxes can and need to go up over time. Already, economists say, “[D]espite having the nation’s highest tax rate, Washington . . . could generate significantly higher revenue by increasing the tax rate.” Continue reading “CNR comments to Vermont Marijuana Commission”

I was surprised and heartened to that California Governor Brown vetoed AB 1863, keeping non-deductibility of marijuana advertising expenses on California individual income tax returns. His rationale is revenue loss and the bill’s evasion of the budget process. https://www.gov.ca.gov/wp-content/uploads/2018/09/AB-1863-Veto-Message.pdf

And I was surprised and heartened to see that the California Legislature hasn’t overridden a veto since 1979.

So there is an opportunity for California to tinker with 280E conformity to treat individuals and corporations the same and not lose revenue. Continue reading “California 280E tax needs fixing”

For instance,

“Another point to which the attention of the Commissioners should be directed is the probability or possibility, that if the use of hemp-drugs is prohibited, those who would other-wise continue to use them may be driven to have recourse to alcohol, or to other stimulants or narcotics which may be more deleterious.” 

IHD vol 3 pages Title-17 or so74464868_53_72

 

Here is a message I sent Governor Brown of California about a bill to allow individual sellers of marijuana, like corporate sellers, to deduct advertising and marketing expenses on their state income tax returns:

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AB 1863 loses revenue.

California should treat individuals and corporations alike for marijuana tax deductions:  Let everything be deductible but advertising and marketing.

That might raise revenue (or maybe come out neutral to avoid 2/3).  It would be better for the budget. Continue reading “CNR urges veto of California AB 1863”

Per-gram taxes on marijuana flower in Colorado have dropped over half, as prices collapse.

For July to September 2018, here are the new producer tax rates for seven categories of marijuana not sold to third parties in Colorado.

Flower: AMR (Average Market Rate) = $846 per pound.
Tax = $126.90 per pound, or approximately $0.28 per gram.
[The highest AMR for flower was $2,007, in the early days, yielding a tax of $301.05 per pound, or $0.66 per gram.]

Continue reading “Colorado’s marijuana tax continues to decline”

I don’t work for marijuana sellers, so why should I give them free advice?  Because I want to keep their ads and promotion non-tax-deductible under 280E.  Ads irritate parents, favor Big Business, and stimulate demand.  They are a frill for consumers.

But even without ads, cannabis sellers have an easy, low after-tax cost way to show customers their products are special.

The customer walks into the retail store, and sees a live feed of suppliers’ grows.  Continue reading “How craft growers might work around 280E”