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A U.S. Senate committee on Wednesday will vote on whether to advance a bill that would allow the legal cannabis industry access to banking, an option that industry lobbyists have long sought.
But even before the Senate Banking Committee takes up the Secure and Fair Enforcement Regulation Banking Act, nicknamed the SAFER Act, some in the industry say it is not enough.
They point to issues including Section 280E of the federal tax code, which states that businesses dealing in illicit substances cannot write off the costs of doing business from their taxes.
Critics include Cody Bass, owner of Tahoe Wellness, a cannabis dispensary in Lake Tahoe, California, who said he is facing $3.4 million in back taxes due to Section 280E.
“It’s really meant to put you out of business. That was the intent of Congress when they passed this in 1983, it was intended for cocaine smugglers in Miami,” Bass said.
The disconnect between the federal and state governments is concerning for the $13.2 billion legal marijuana industry.
The federal government lists cannabis as a Schedule 1 illegal drug, with no potential medicinal uses, making it even more strictly controlled than cocaine and fentanyl.
Meanwhile, 22 states have legalized cannabis either for medical or recreational purposes.
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