The business of pot

When I was in high school and college in the 1970s, marijuana was (a) illegal and (b) plentiful. I may or may not have inhaled, but people I knew were certainly growing, drying, selling and buying dope at the time. From a public health standpoint, marijuana is more benign than alcohol and tobacco.

I’m happy to see the cannabis industry taxed. Cannabis, while organic, isn’t exactly health food and certainly isn’t the staff of life. But from an economic standpoint, legalization is a win, win, win.

“Companies that grow, manufacture, and sell their own cannabis products can fold more expenses into the “cost of goods sold,” the only allowable deduction under the current tax code. But they still often struggle, said Tracy LeMaire, co-founder of TAC CPAs, an accounting firm that works with cannabis businesses.

“The top five multi-state operators nationwide paid a combined $2 billion in taxes between 2020 and 2023. But under the coming tax changes, they would probably only have to pay one-tenth of that, about $280 million, according to a study from FTI Consulting, a management consulting firm.

“Cannabis is a state-legal business,” LeMaire said. “Why should they have to pay more taxes than the corner store?”

“David Goubert, chief executive of Ayr Wellness, which sells cannabis products in six states including Massachusetts, said his business contributes $50 million to taxes annually across the country. An end to the current stringent tax regulations would bring leeway and allow the company to hire more people, Goubert said.”

The business of pot