On Tuesday, the California Legislature passed a bill that would allow marijuana operations in the state the capability to deduct business expenses from their state taxes. Smart Approaches to Marijuana Action founder and president, Dr. Kevin Sabet, released the following statement:
“Pot businesses should not be allowed to deduct advertising and other expenses that boost their marketing power. New research has found young people who see medical marijuana ads are more likely to use the drug than those that do not.
“This bill seeks to allow pot businesses a work around of Section 280E of the tax code-created by Congress after a drug dealer was found to be writing off expenses from his illicit trade on his taxes. It remains a crucial check on Big Marijuana as it attempts to become the next Big Tobacco. It states that taxpayers ‘trafficking in controlled substances’ get no deduction for many expenses. As a reminder: marijuana is illegal under federal law.
“While the marijuana industry lobbyists claim that this bill will simply allow these operations to write off ordinary expenses, the reality is much more disturbing. Outside of granting legitimacy to these federally illegal operations, removal of Section 280E will be a boon for marijuana advertising.
“If California allows these operations to deduct their advertising costs from their tax bill, the already booming pot ad business will grow even more out of control. The marijuana industry is already well-known to produce kid-friendly, 99% THC cookies, brownies, sodas, and ice creams. Ads for these products will encourage heavy use, and would blanket the poor and minority communities the industry views as its profit centers.
“The marijuana industry is working day and night to become the next Big Tobacco. Lawmakers should not be bending over backwards to assist in their attempts to put profits over public health.”