Anti-marijuana Rep. Pete Sessions (R-TX) may have lost his reelection bid in the midterms, but for another few weeks he still has the power to prevent cannabis amendments from advancing as chairman of the House Rules Committee—and that’s just what he did on Wednesday.
This time, Sessions, who has overseen the blockage of more than three dozen separate cannabis-related proposals from even being considered on the House floor during the 115th Congress, shot down an amendment to ensure tax fairness for legal cannabis businesses.
The measure, filed by Rep. Jared Polis (D-CO), who is also leaving Capitol Hill soon after winning an election earlier this month to be Colorado’s next governor, would scale back the reach of the federal tax provision known as 280E.
Originally enacted in the 1980s, the policy was meant to stop drug cartel leaders writing off yachts and expensive cars from their tax returns. But today its plain language means that growers, processors and sellers of marijuana—still a Schedule I substance under federal law—cannot take business expense deductions that are available to operators in other sectors, even if they fully comply with state law. As a result, they are forced to pay effective tax rates that can approach 70 percent.
Polis’s amendment, which he was seeking to attach to a broader package of tax reforms being pushed by Republicans, would have amended the provision so that it would not apply to any “trade or business [that] consists of marijuana sales conducted in compliance with State law.”
But in a move that has come to be seen as expected for cannabis measures over the past several years, the Rules Committee refused to make the amendment “in order” and clear its path for a vote by the full House.
Legalization supporters are optimistic about their chances of getting 280E and other marijuana reforms to the House floor soon, though. In addition to Sessions losing his fight for reelection, the Democrats won control of the chamber in the midterms.
And Rep. James McGovern (D-MA), the incoming Rules Committee chairman, has already pledged that he will allow marijuana amendments to be considered by the full body when he takes over the panel’s gavel in January.