Connecticut lawmakers sent the governor a budget bill that included provisions that would provide tax relief at state level to licensed marijuana businesses who are currently not allowed to make federal deductions due to an Internal Revenue Service code (IRS) known as 280E.
A separate cannabis omnibus law was also sent to the Governor. This week, Ned Lamont, a Democrat, introduced a bill that includes a number of reforms. These include the creation of an Office of the Cannabis Ombudsman, a permit system for cannabis retailers to hold off-site events, and
According to the provisions of the budget legislation licensed cannabis businesses would be able deduct “the amount that ordinary and necessary expenses would be eligible for a federal deduction…but are not allowed under Section 280E because marijuana is a control substance
This measure contains provisions for the cannabis social equity and substance abuse prevention and regulation fund. It also repeals the tax credit given to marijuana “angel” investors who support new cannabis businesses, a policy change that was proposed by Governor earlier this year.
Lamont announced that he will sign the bill into law within the next few days.
The 280E fix is in line with the legislation that several states have sought to pass to help state marijuana markets which are subjected under federal prohibition, to significantly higher tax rates.
Illinois legislators , for example, have sent to the governor a budget bill this week which includes similar language allowing state-licensed marijuana to take tax deductions. They are prohibited from doing so
The governor of New Jersey also signed legislation to allow licensed marijuana business to deduct some expenses on their state taxes as a partial IRS 280E Workaround. Iowa lawmakers, New York legislators, Pennsylvania, and Virginia lawmakers have all pursued similar tax relief measures for their respective marijuana markets.
New York Senate passed on Monday a bill to fix the 280E tax code for New York City’s cannabis companies because the statewide reform had not affected the city’s tax laws.
In Connecticut, a separate marijuana omnibus bill is also headed to the governor. It would establish a definition of edible cannabis products as well as revise rules for the state lottery system that governs marijuana business licensing.
This bill has many implications. It affects the lottery process by implementing a cap on submissions, modifying the definitions, clarifying license types, reclassifying high-THC products as marijuana, and extending deadlines for lottery candidates
She said that the changes would have a wide-ranging impact on future licensees, as well as existing hemp and marijuana businesses in Connecticut. While some changes will be welcomed, others could disrupt business and future plans.
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Connecticut’s House of Representatives passed a bill in the last month that would expand on the state’s legalization of marijuana and expungements laws, by requiring that courts reduce sentences or dismiss charges when a wider variety of cannabis
Last month, the House passed a bill that would decriminalize possessing psilocybin mushroom.
Lamont also announced that in January, the state had cleared almost 43,000 records of marijuana-related convictions. In 2021 , he passed legalization legislation which empowered the state government in order to facilitate mass cannabis convictions relief.
In January , the state launched a website that gives residents information on the status of their cannabis records. It also provides guidance to those who have older convictions for cannabis that were not automatically erased by the courts.
Lamont is optimistic about the adult-use market launched by at the start of the year. He believes it will reduce illicit sales.
He joked about his concern for the cannabis industry’s rollout, which was finding a spot in the line at a dispensary. He wasn’t serious but he had previously not ruled out participating in the legal market.
State data show that in March, Connecticut had a combined sale of recreational and medical marijuana worth a record 22 million dollars.
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Photo by Chris Wallis // Side Pocket Images.
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