What to Grass about New York passing the bill to legalize adult-use recreational Cannabis.
New York becomes the 15th State to legalize the adult use of cannabis. This historic move for the State of New York legislation has been long overdue. The Garden State of New Jersey recent passing of the bill to legalize recreational cannabis use may have given the Empire State a hard push to follow suit. Nonetheless, New York is green lit and ready for greener pastures.
The bill allows individuals over the age of 21 to grow, use, and purchase cannabis freely. Individuals can grow up to 3 mature & 3 immature cannabis plants, possess up to 3 ounces, and possess up to 5 pounds in the home for personal use. There will be a 12-plant cannabis limit per household. There also will be new laws assessing penalties driving under the influence. Municipalities will have the option to opt out of having adult-use dispensaries or consumption licenses in their local areas by December 31, 2021.
What can Cannabis do for the Empire State?
The new bill would establish an Office of Cannabis Management and Cannabis Control Board that will regulate and license the state’s adult use program. The Cannabis industry has been deemed an essential business during the Coronavirus pandemic and can help generate revenue for the struggling New York economy. The marijuana adult-use industry has the potential to generate $300-350 Million in annual tax revenue and create 60,000 new jobs across the state. Cities and towns that do not opt out of the marijuana adult-use can tack on an additional 4 percent local tax for sales or deliveries.
The new bill can amend some of the damages impacted on minority communities with decades long war battles on the cannabis drug. Cannabis sales and tax revenue will be reinvested each year to those same communities and business licenses will be reserved for minority business owners.
Collecting & Staying in the Green
When cannabis revenue starts rolling in state sales tax will be the biggest burden for majority of marijuana companies. There also may be cultivation tax, manufacturing tax, and distribution tax to think about as well. Collecting revenue and staying in the green will require a reliable accountant to handle your tax compliance needs. Let Smyle & Associates, LLC be the accounting firm to relieve your burden and handle the tax compliance.
“The only difference between a flower and cannabis is judgment”
Written By: Dwayne Ailey
Senior Tax Manager
