In Washington state we have pioneered, thanks to vigorous and politically-active citizens and a robust citizen initiative process, the re-legalization of cannabis. Voters overwhelmingly approved - 59% yea to 41% nay - access to medical cannabis in 1998 (I-692, the Medical Use of Marijuana Act), and legalization for everybody in 2011 (I-502, An Act Relating to Marijuana), which passed 56% to 44%. Both have been huge successes. As of April, 2016, legal marijuana sales in Washington totaled $714,462,849 - yes, $714 million! – and the state has collected tax revenue totaling $252 million: $192,839,331 in excise tax and $58,992,345 in sales tax. In a state that finances its operations without an income tax, and is perpetually short of funds, $252 million pays for a lot of schools, EMS, firefighters, and other essential services.
But cannabis remains illegal at a federal level, which creates a number of problems for Washington state citizens involved with legal cannabis, both businesspeople who grow and sell cannabis products, and consumers of legal cannabis products. Veterans with PTSD, for whom cannabis provides relief, not only cannot get a cannabis recommendation from their Veterans Administration physician, but also risk losing their VA benefits if they use this safe, non-toxic medicine. Students with a minor misdemeanor marijuana offense are ineligible for federal student loans, unlike, for example, murderers or thieves, who are eligible!
Legal cannabis businesses cannot open a bank account because federal law forbids banks from dealing with them. They also have a serious problem with the IRS- which considers that as illegal businesses, they cannot deduct their normal and customary business expenses but must pay tax on their gross income, including excise taxes! And, due to a regulation that governs tax preparers, Circular 230, all CPAs or other tax advisors are required a) to inform their clients that their illegal business expenses are non-deductible, and, b) then resign, no longer serving the client, since under Circular 230, tax preparers cannot associate themselves with a client involved in an illegal business. It’s a terrible catch-22 for both business and CPA.
It’s a testament to the hard work and resourcefulness of Washington businesspeople that cannabis businesses are so successful given the hurdles and difficulties put in their way by the federal apparatus. But we live in a representative democracy and can rely on our representatives to make the necessary changes so that Washington state citizens going about their legal business are not penalized by federal laws. Right?
Well, apparently not in Washington's 2nd District where our “representative” is Rick Larsen. What bills have you sponsored or co-sponsored, sir, to relieve the burden on legal cannabis businesses and citizens in your district? Did you sign on as co-sponsor to the timid H.R.1940, Respect State Marijuana Laws Act of 2015? Or H.R. 1538, Compassionate Access, Research Expansion, and Respect States Act of 2015? Or H.R. 667, Veterans Equal Access Act, which allows veterans to access state-legal medicinal marijuana and not lose VA benefits? Nope to all. But you did co-sponsor H.R. 2920, the Captive Primate Safety Act and H.R. 2016, the Refuge From Cruel Trapping Act– so apparently you feel you represent gorillas and chimps and fur-bearing animals but not your state’s legal marijuana businesses?
Please detail how you propose to represent over 60% of the citizens in your district who voted for legal cannabis. Please explain why it appears you have done nothing in this regard to date. What do you think your job is, exactly? Is it photo ops cleaning up beaches, or actually working on behalf of the hard-working taxpayers in your district that the federal government deems criminals?
Why should we vote for you?
Copies of this letter will be sent to all candidates in the 2016 primary in the 1st and 2nd Districts. Replies will be posted below as comments. Non-replies will also be noted.
Prepared as a Public Service by David M. Camp, cpa WA License # 30879
This article is copyright by the author under Creative Commons License CC BY 3.0 – Share with attribution.