Virginia Lawmakers Approve Bills On Marijuana Sales And 280E Tax Reform ( Another One ☝️)

By Kyle Jaeger January 30, 2023

ANOTHER WIN FOR OUR COMMUNITY!

Virginia lawmakers on Friday advanced bills to start adult-use marijuana sales and allow cannabis businesses to make certain tax deductions at the state level while they’re barred from doing so federally under the Internal Revenue Services (IRS) code known as 280E.

The 280E bill passed the Senate unanimously in a 40-0 vote, carried by Sen Adam Ebbin (D). The House of Delegates companion version from Del. Jeffrey Campbell (R) moved through an Appropriations subcommittee in a 7-1 vote and now heads to the full panel for consideration.

The legislation seeks to decouple Virginia’s marijuana industry from the federal tax code, as lawmakers in several states like New Jersey, New York and Pennsylvania have moved to do. State medical and recreational cannabis businesses would be able to take deductions at the state level that they’re currently barred from doing federally under IRS’s 280E.

Separately, in the Democratic-controlled Senate, the Rehabilitation and Social Services Committee voted 9-6 to refer an adult-use marijuana sales bill, also from Ebbin, to the Finance and Appropriations Committee.

There have been open questions about how the state legislature would address cannabis commerce for adults in the 2023 session after lawmakers approved a bill in 2021 legalizing marijuana possessionfor people 21 and older. That legislation included sales provisions but they were subject to reenactment, and lawmakers in 2022 did not act on the issue under the new Republican governor and GOP-controlled House of Delegates.

The House has since been a sticking point for advocates, with legislators largely divided on how to proceed with a possible commercial market. The legislation that passed a Senate committee on Friday would allow recreational cannabis sales to begin on January 1, 2024.