Being able to have a cannabis related business and grow it, in the long run, is very challenging nowadays. The main reason is that while some of the laws and regulations are supportive for cannabis, others just don’t seem to help the cause at all. The DOJ recently dropped a case against not selling at medical marijuana at Harborside in California, but there are still many other steps to perform until the issues will be solved.
The main issue that the marijuana industry has is that the rights problems differ from state to state. There are a few states that have already fully legalized marijuana and some at least have medical marijuana. However, at a federal level, you will see that marijuana is still illegal and that is not a good thing at all. Companies that commercialize marijuana are heavily investigated and numerous penalizations were applied based on this type of problem alone.
While many states already handled the issue, it seems that at a federal level things are a lot more complicated. This type of problem leads to many more challenges. For example, due to the law 280E focused on the internal revenue code, the marijuana-based businesses don’t have the same benefits that regular legal businesses do. These companies have to pay around 70% in federal taxes which is definitely not what the regular businesses do.
A similar problem comes from the financial side and more specifically from banks. These institutions have to comply with the legal repercussions that can appear and thus they rarely manage to serve the cannabis-based companies. Institutional capital is necessary for all cannabis companies but they have a problem accessing that due to compliance and regulations.
The industry is ready and it will definitely take off when the legalization will happen. But since even the president said he does not support the marijuana legalization, it’s really hard to figure out the right approach at this particular time. If marijuana is still seen as a schedule 1 drug, banks will still have an issue funding any type of company in this industry.
One of the new challenges that might appear soon comes from the weed legalization in California. The residents will have the ability to vote on legalization on November 8 according to LA Times!
We can definitely expect some great changes if one of the largest states in the US agrees to Marijuana legalization. If the vote will be a successful one for the industry, this will be a huge step forward. On the other hand, a negative vote will definitely slow things down and the marijuana legalization at a federal level will be even further down the road.
There are many things that stand in front of the marijuana industry but things will get better if people are supportive. Creating and sharing petitions or even going to vote can make a huge difference and this is the best way to show support for the industry!