COLUMBIA – New medical marijuana legislation could bring tax benefits to Missouri dispensaries.
The Missouri House Ways and Means Committee approved Senate bill 807 on Wednesday. The bill would allow medical marijuana dispensaries to claim businesses expense deductions on their tax returns, which is currently not allowed in Missouri because cannabis is still federally illegal.
David Smith, the treasurer of the Missouri Medical Cannabis Trade Association, is one of the outspoken proponents of the bill.
“This bill is designed to place legally licensed cannabis operators on equal footing with any other legal business in the state of Missouri,” Smith said.
Smith gave testimony in support of the bill in front of the Missouri Senate last spring. He says the bill’s benefits extend past dispensary owners and will also financially assist medical marijuana consumers.
“Taxation at a business level ultimately gets passed down to the consumers by way of higher prices,” Smith said. “If the tax burden for the business is reduced, then we certainly would expect to see lower pricing at the retail consumer level.”
One of the mid-Missouri businesses that would benefit from these tax deductions is 3Fifteen Primo Cannabis. Despite opening its doors less than two years ago, it was the first medical marijuana dispensary established in Columbia.
While he says his business could use the financial relief, owner Jason Corrado says he will also pass these benefits along.
“Any relief of a tax burden or any relief of a cost burden we will pass along to the patient,” Corrado said.
While the bill would not apply to federal tax deductions, Corrado says the tax deductions would be enough for his workers and buyers to notice.
“Any advantage we can have as a business is just going to allow us to give better pricing to our consumers and treat out employees better,” Corrado said.
Opponents of the bill have argued that offering dispensaries this tax privilege reduces tax collection at the state level and places a higher burden on the public. However, Smith says this difference would be negligible.
“This is a new industry that is now legal,” Smith said. “Really, the state is losing tax revenues that it would be losing anyway. At the end of the day, there is no downside. It’s really just a policy that makes sense.”
The bill will how head to the House floor. If approved by the end of session, it could go into effect by the end of August.