In a joint effort, the governors of Colorado, Illinois, New York, New Jersey, Maryland, and Louisiana have penned a letter to President Joe Biden, urging the administration to reschedule marijuana to Schedule III of the Controlled Substances Act by the end of the year. The move, they argue, will bring economic and tax benefits for cannabis businesses, enhance public health, and better align government policy with the overwhelming support for marijuana legalization among the American public.
The Governors' Perspective:
The governors emphasize the importance of rescheduling marijuana to ensure a safe and regulated product that Americans can trust. They highlight a poll revealing that 88 percent of Americans support legalization for medical or recreational use. While acknowledging differing opinions on recreational cannabis, the governors unanimously agree that the cannabis industry is here to stay, and state-regulated markets are crucial for the safety of the American people.
The Recent HHS Recommendation:
The governors note that the recent recommendation from the Department of Health and Human Services (HHS) to reschedule marijuana aligns with the success of state-regulated markets. They see this as a vote of confidence in state regulators and the robust regulations they have established to protect citizens.
Economic Benefits of Rescheduling:
Economic advantages feature prominently in the governors' letter. Rescheduling to Schedule III would alleviate restrictions on Section 280E of the Internal Revenue Code, allowing cannabis-related businesses to take ordinary business deductions like other American businesses. This change is estimated to save approximately $1.8 billion per year, shifting cannabis companies to a standard federal corporate tax rate of 21%, a significant drop from the current effective tax rate of up to 80%.
Ensuring a Thriving Industry:
Governor Jared Polis of Colorado, who led the group letter, emphasizes that rescheduling will not only address financial and safety concerns for businesses but will also enable the cannabis industry to play a full role in the American business environment.
The Importance of State-Regulated Markets:
The governors argue that the demand for marijuana in the United States is not diminishing and stress that regulated products are safer than those sold on illicit markets. They believe that a state-regulated marketplace is essential for ensuring the safety of adult consumers while simultaneously protecting children from unsafe products.
Challenges and Future Actions:
While applauding the recent HHS recommendation, Governor Polis highlights the need for further actions, including addressing banking and FDA enforcement guidance. The governors express confidence in the DEA's expeditious review but advocate for additional administrative and congressional actions to promote health, safety, and economic growth.
Conclusion:
The governors' letter underscores the multi-faceted benefits of rescheduling marijuana to Schedule III, emphasizing economic relief for businesses, enhanced safety through regulation, and alignment with widespread public support. As the debate on marijuana scheduling continues, the governors make a compelling case for a comprehensive approach that considers the economic, health, and safety implications of this policy change.

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