Two Democratic lawmakers from Oregon are teaming up with a rightwing, anti-tax zealot to provide relief to small businesses getting into the marijuana game.
Sen. Ron Wyden (D-Ore.) and Rep. Earl Blumenauer (D-Ore.) announced plans on Thursday to introduce legislation to update IRS laws. A reform that would allow businesses that sell pot in compliance with state law to take routine tax deductions.
Current law prohibits marijuana retailers from deducting business expenses like payroll, utilities, and rent, which could force business owners to deal with a federal tax bill as high as 90%, the lawmakers claim.
The duo noted that twenty states including Washington, DC have legalized the sale of medicinal marijuana, and another two states, Colorado and Washington, have legalized buying marijuana for recreational purposes, which begs the need for reform at a federal level.
“More than two-thirds of Americans now live in jurisdictions that have legalized either the medical or adult use of marijuana. It’s time for the federal government to catch up,” Rep. Blumenauer said in a press release on Thursday.
Sen. Ron Wyden framed the issue in terms of states’ rights, saying the legislation is about “ensuring that the federal government respects the decision Oregonians have made at the ballot box.”
Their legislation, The Small Business Tax Equity Act, was introduced last year as well, but failed to gain traction. This time around, however, it has the support of power players in the conservative wing, who’ve long championed tax reform.
Grover Norquist, the President of Americans for Tax Reform–a group that gained clout on Capitol Hill by encouraging most Republican lawmakers to sign pledges to never raise taxes–is backing the legislation. Norquist slammed the current war on drugs-era laws that are discriminating against legitimate business owners.
“The intent of the law was to go after criminals, not law abiding job creators. Congress needs to step up and clarify that this provision has become a case study in unintended consequences,” Norquist said in the statement released by the lawmakers.
Growing displeasure with the failed war on drugs has spurred movements around the country to both legalize the use of marijuana, and to reform the criminal justice system so that non-violent drug offenders don’t receive overly harsh prison sentences.
In February, Norquist and the politically active, and well-financed conservative Koch brothers announced they were teaming up with left-leaning organizations like the Center for American Progress and the American Civil Liberties Union to lobby for prison sentencing reform.
The unlikely allies have put $5 million into the effort, creating an organization known as the Coalition for Public Safety.
