A conservative anti-tax lobbyist has become an unlikely supporter of marijuana reform at the federal level. On Thursday, Grover Norquist, president of Americans for Tax Reform, told reporters that despite never trying cannabis (“absolutely not”), he is against the federal over-taxation of medical and recreation marijuana.
“There’s always a slight giggle factor on the issue dealing with marijuana,” Norquist tells Time magazine. “That said, this is tax policy, this is real stuff. This is important. This is everything from jobs to whether the federal government comes in and writes rules that upsets the apple cart in many, many different states.”
Currently, medical marijuana business owners are prevented from deducting otherwise normal business deductions due to a clause in federal tax law that makes it illegal to deduct taxes for a business involving a federally illegal substance. The law was meant to be a way to tack on sentencing huge drug traffickers, but has proven to be a burden to state-legal marijuana distributors.
Rep. Earl Blumenauer, a Democrat from Oregon, has sponsored a bill this session dubbed the Small Business Tax Equity Act that would allow state-legal cannabis businesses to begin deducting on their taxes.
Norquist says he was made aware of the marijuana taxation problem a few months back. While he’s not a pot supporter, he’s a supporter of state rights and not beating up small businesses with heavy taxes.
“In Colorado and some of these other states, marijuana dispensaries are just legal businesses. They should be treated that way. But federal law makes that difficult to impossible,” says Norquist. “We’ve got to take the IRS out of this issue.”
Unfortunately, Bluemenauer’s bill has been given a slim-to-none chance at being passed or even being considered by the House. Several activists have suggested that the feds aren’t going to quick to cut in half a huge source of revenue.
“I think comprehensive tax reform is not something that is beyond our reach, but it is a heavy lift,” said Blumenauer. “It would be nice to do a little momentum building, and have people work together on things that are common sense and have bipartisan support. And this is a classic example. What we’re doing first is building the understanding of this issue and its support. But I think that this is a perfect item that can be dropped into any tax vehicle going forward.”
