Blum Holdings Inc (BLMH)

[BidnessMan]

How the U.S. tax code keeps the illegal market for marijuana alive and well

Under Section 280E of the code, cannabis businesses are not allowed to take tax deductions on normal business expenses like employee salaries, rent and utility bills because the federal government considers their trade illegal drug trafficking -- even where cannabis sales are legal under state law. As a result, the effective federal tax rate for legal cannabis businesses can reach 70% to 90%. No other industry has to operate with this very high tax rate.

The illegal market pays no taxes - federal or state.

https://www.latimes.com/opinion/op-ed/la-oe-deangelo-marijuana-cannabis-tax-deductions-20190715-story.html