The legalization of cannabis is up for debate in Congress

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It has been more than 50 years since the Controlled Substances Act was signed into law, designating cannabis as an illegal Annex I narcotic “with no currently accepted medical use and a high potential for abuse.”

During this time, millions of Americans were arrested and imprisoned for nonviolent crimes related to
the criminalization of the plant, ruining lives and destroying families.

Congress leaders now hope to amend.

July 2021, leader of the Senate majority Chuck Schumeralong with Senators Cory Booker and Ron Wyden, introduced the Cannabis Administration and Opportunities Act (CAOA), which would remove marijuana from the Schedule I list, effectively legalizing it nationwide.

The bill allows states to establish their own cannabis policies, but federal regulations would also be implemented.

While the bill is truly innovative and a symbol that legalization is closer than ever, the CAOA is facing a tough battle.

In addition, many industry professionals and advocates are concerned about certain components and wonder if the move will cause operators to fail.

“It’s an incredibly strong indicator of a paradigm shift when it comes to attitudes toward cannabis,” said Evan Nison, board member of NORML and SSDP, founder of NisonCo PR.

“While the bill may not get the votes it needs to pass this time around, it is a clear sign that legalization is imminent.”

But how exactly will the bill affect the industry and what do space professionals say? Cannabis and technology today breaks the CAOA debate.

The big picture

The Cannabis Administration and Opportunities Act is the most comprehensive piece of cannabis reform legislation to date. In addition to removing the federal ban on the plant and its derivatives, the 163-page bill touches on everything from interstate commerce to social equity.

Here are some key points:

Implementation of the federal sales tax – The CAOA stipulates a federal sales tax on the sale of cannabis products in addition to state-imposed taxes. The initial tax would be 10% for companies that meet an annual sales threshold, gradually rising to 25% in five years.

Deletion of criminal record – According to the CAOA, thousands of Americans would be eligible to eliminate nonviolent cannabis-related convictions. Federal sanctions would also be removed.

Increased search – Peer-reviewed studies on the cannabis plant and its effects have remained extremely limited due to criminalization. The CAOA directs funding toward research, specifically targeting brain health as an area to focus on.

Restorative Justice – The bill calls for the establishment of three unique grant programs designed to support the communities most affected by the war on drugs. This includes funding for job training and other re-entry services for cannabis offenders who had been jailed.

280E Relay – One of the biggest challenges facing marijuana operators has been 280E, a section of the tax code that prohibits companies that touch plants from deducting business expenses. The CAOA would rectify this, allowing cannabis companies to access tax credits for which they do not currently meet.

Mixed industry response, with many calling for changes to the initial draft

On the deadline for public comment on September 1, a large number of lawyers, non-profit organizations, and industry trade organizations intervened in the bill. A wide range of comments and suggestions were poured in, offering recommendations for reviews of everything from consumer rights to barriers to entry for new entrants.

The National Cannabis Industry Association (NCIA), one of the largest trade groups in the area, sent a nearly 30-page letter to bill sponsors after reviewing comments from its members.

“The CAOA is a good starting point for a discussion in the Senate on how best to end the ban, repair the damage it has caused, and effectively regulate the substance at the federal level,” said Morgan Fox, director of relations. with the means of the NCIA.

“As a bill, it still needs a lot of work.”

Fox noted that members of the organization disagreed with the proposed tax model described in the CAOA, arguing that the current structure is not viable.

“The fiscal components of the draft language would be worse than the status quo in most cases, undermining the viability and potential of the regulated cannabis market,” he said.

“This tax structure would disproportionately harm small businesses and encourage the unregulated market.”

Consumer advocacy groups pushed the language further to protect cannabis users, especially medical patients. Americans For Safe Access called on lawmakers to address barriers to housing assistance for drug users, as well as increased medical cannabis education for federal officials.

NORML also called for a focus on restorative justice while maintaining the integrity of existing markets and operators.

The sponsors of the bill will review the comments submitted and submit a formal version the Senate in the near future.

Fog perspective on CAOA, but reform is near

Despite the enthusiasm of Senate Majority Leader Schumer for marijuana reform, it remains to be seen whether the Cannabis Administration and Opportunities Act will get the 60 votes needed to pass.

That, coupled with President Joe Biden’s lukewarm attitude toward cannabis, could be a disaster for the bill, at least for now.

That doesn’t mean federal legalization isn’t coming. Industry professionals and analysts believe that it is not a question of whether but of when.

“90% of Americans believe that cannabis should be legal and politicians tend to listen to their constituents,” Nison said. “This has become a major issue.

“I would bet on seeing federal reform in the next four or five years.”

This article originally appeared in the fall 2021 issue of Cannabis & Tech Today. Read the whole number here.

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