In the agreed-upon Fiscal Year 2023 budget agreement between New York lawmakers and Gov. Kathy Hochul (D), state-approved cannabis businesses will be eligible for the same tax break that is currently in place for other types of businesses.
Including the provisions would help the state’s cannabis operators as U.S. tax law prohibits the industry from any federal tax deductions under Section 280E of the tax code.
The New York tax break would apply to taxable years beginning on and after Jan. 1, 2022.
The budget bills proposed by both the Assembly and Senate, which are controlled by Democrats, include language stating that “the provisions of Section 280E of the Internal Revenue Code, relating to expenditures in connection with the illegal sale of drugs, shall not apply for the purposes of this chapter to the carrying on of any trade or business that is commercial cannabis activity by a licensee.”
Several other states have moved to allow licensed cannabis businesses to take business deductions allowed by non-cannabis companies. A bill introduced last month in California would allow operators to receive a tax credit equal to the amount of the following qualified business expenses: employment compensation, safety-related equipment and services, employee workforce development, and safety training. The bill sponsor, State Sen. Scott Weiner (D), said the measure would help combat illicit sales in the state.
Missouri lawmakers had approved a measure last July that would have allowed the state’s medical cannabis companies to make normal state deductions; however, Gov. Mike Parson (R) ultimately vetoed that bill due to provisions that would have provided tax relief to businesses impacted by city-wide or county-wide public health restrictions which created “significant unintended consequences that could greatly harm localities.”
Get daily cannabis business news updates. Subscribe
Thanks for reading our latest news article. Stay up to date on the latest hemp news, sourced and approved by HempRevs. If you have any questions or comments, please feel free to leave us a message in the comments!
Sign up for our weekly newsletter to stay up to date on the latest Industry news and keep a look out for our next story!
Source Disclaimer: This article was was sourced from Ganjapreneur.com (the Original Publisher). In order to maintain the functionality, trust, and safety of HempRevs.com, the content sourced from the Original Publisher may have been altered. Read the original article here:
New York to Allow Cannabis Companies to Take State Tax Deductions