In a creative and dramatic demonstration of defiance, a major marijuana company recently staged a protest inspired by the iconic Boston Tea Party. Dispensing with colonial-era vessels in favor of a massive pile of fake money, the protesters took aim at the federal tax code 280E, which continues to trouble the marijuana industry.
1. A Rebellious Show of Support: Marijuana Company Stages Boston Tea Party-Style Protest
In an ambitious and possibly revolutionary move, the marijuana company Bud Band Natural recently staged a visual demonstration of their political strength. On the morning of October 15th, 2020, Bud Band Natural organized a re-enactment of the original Boston Tea Party in the public waters of Boston. More than 300 people were present, waving blackfins, red flags, and cannabis green.
The show of emotion was met with the cheers of onlookers, and the act of solidarity was celebrated with upraised fists and claps – the energy of support for the movement to legalize marijuana in America unquestionable. The day began with seven bundles of marijuana leaves held aloft and then thrown onto the waters, the Bud Band Brothers making sure that each bundle made a large splash. Afterwards, the crowd formed an encircling circle of devotion, the participants holding candles and singing a rendition of Bob Marley’s “Redemption Song”.
- Campaign Motto: Burning Notices with Cannabis
- Ganja Commander: Bud Band Natural
- Date: October 15th, 2020
2. Painful Impact of Tax Code 280E On Legal Marijuana Industry
The Marijuana Industry Has Built a Lucrative But Hemorrhaging Business
The marijuana industry’s legal status has created an eye-wateringly profitable industry. But between state and federal laws, the liability of 280E has made running a viable marijuana business a money-losing proposition. Beyond the requirements and reporting for taxes, 280E forbids traditional business deductions like expenses and costs. This means dispensaries must pay taxes on their entire revenue, often over three times the taxes paid by other businesses. Disregarding the minor paperwork reliefs, 280E creates a punishingly steep rise in business costs, making it hard for cannabis businesses to retain profits and reinvest.
The impact of 280E doesn’t just hurt the core industry, it also impacts the related services like marketing, real estate and consulting. These ancillary services cannot claim the usual deductions, leaving them in a state of financial uncertainty. Without any of the usual deductions, such businesses are walking a tightrope, trying to maintain profitability in a highly competitive sector. In some cases, they are forced to absorb the burden which 280E imposes on them or risk of operating unsustainably.
- Marijuana industry is profitable but hampered by 280E
- 280E prevents traditional business deductions like expenses and costs
- Related services like marketing, real estate also impacted
- Without deductions, businesses operate unsustainably
3. Protest Demands Relief for Businesses Affected by 280E
The 280E tax code has become, for many businesses, an economic burden. It′s an act taken by the Internal Revenue Service to prevent businesses from using their profits to fund and/or invest in any illegal products, such as drugs. This has translated to a significant loss of income for many businesses that operate in the cannabis industry.
The recent protests have aimed to call attention to this unequal taxation and demand relief for businesses impacted by this outdated law. Activists are pushing for the immediate repeal, or at the very least, a loosening of the restrictions the tax code applies to cannabis companies. Among the list of their proposals, they demand:
- End punitive practices enacted by the IRS, such as the application of the 280E tax to cannabis companies.
- Lift restrictions on access to business banking services and other financial investments.
- Eliminate the kind of mandatory reporting for cannabis businesses by banks and other investors.
By focusing on these specific issues, many activists believe it will open up more businesses opportunities and help with the innovation of the industry. It will also help to create more equality between the cannabis industry and other businesses in the United States.
4. Change is Needed For The Sake of Cannabis Industry and Consumers Alike
The cannabis industry is going through plenty of changes due to various reasons such as changing legislation and the emergence of new consumers. As a result, the industry needs to make certain changes for the sake of both consumers and the industry itself. Here are a few of the changes that need to be made:
- Changes in Regulations – The regulations surrounding the cannabis industry are constantly changing and need to be updated in order to stay on top of the trends. These changes should take into account the needs of both the industry and the consumers, and should be able to adapt to any situation.
- Technology Adoption – As the industry evolves, technology should be used to offer better and more efficient services to the consumers. This would include advances in payment processing, product testing, and tracking systems.
- Education and Awareness – The cannabis industry needs to be more knowledgeable and proactive in educating the public on the different products, usage, and benefits of cannabis. This includes everything from proper dosing to understanding the different effects of different product types.
- Product Quality Control – As new products emerge, it is important for the cannabis industry to ensure that only the highest quality products are produced and available to consumers. This includes testing for contaminants, potency, and safety, and also making sure that the products are labeled accurately.
At the same time, consumers need to be more mindful of the products they consume and be aware of the potential health risks associated with cannabis use. Comprehensive information should be made available to ensure that consumers understand the risks and are educated on the products available. Education about responsible cannabis use should be top priority, and this includes understanding proper dosing, frequency, and the effects of different product types.
The marijuana industry continues to battle against the federal tax code outside of through the courtroom. This time, it was a marijuana company that decided to make a spectacle out of it, calling attention to the troubling 280E tax code. It remains to be seen if this protest will make a difference, but the industry will certainly be keeping its eye out for any progress.