ABSTRACT
This chapter explores scholars to key restraints imposed upon the cannabis sector. Recent legislative initiatives show great promise for shaping a more equitable and accessible cannabis marketplace for stakeholders. An appreciation for this complex tax and regulatory landscape will help one navigate future business, economic, or tax policy research in this field. The fact that methods of applying cannabis excise taxes vary significantly from state to state highlights the various tax schema options available to policy makers under an entrepreneurial model. Tax court rulings have effectively established a precedent that cannabis-related businesses are permitted to deduct costs directly used in the cultivation or manufacturing process, as well as partially deduct indirect production costs, but not other common costs associated with running a business. In 2019, the Treasury also denied the tax-exempt status of an organization that provided financial assistance to medical cannabis patients.
