Under the current federal tax code, businesses that sell Schedule I or Schedule II substances – as defined by the Controlled Substances Act – are prohibited from receiving tax deductions from the expenses associated with the sale of the illicit substance. Marijuana is classified as a Schedule I substance.
“With more states joining Colorado to legalize medical and recreational marijuana, we need a tax code that doesn’t unfairly penalize these small businesses that are trying to operate within the law,” Bennet said in a statement. “This bill would make important updates to our tax code to allow legal marijuana businesses to take the same tax deductions as other small businesses.”
Sen. Ron Wyden, D-Ore., introduced the bill in the Senate last week. It was then referred to the Committee on Finance.
A House version of the bill was introduced in 2013 by Rep. Earl Blumenauer, D-Ore., but never reached a vote.
Twenty-three states and the District of Columbia currently allow for the use of medical marijuana, while four have legalized at least some degree of recreational use.
Michael Cipriano is a student at American University in Washington, D.C., and an intern for The Durango Herald.
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