The GOP tax plan could be forced to include a break for legal weed

The Republican tax bill will deliver big tax cuts to corporations. And if a Colorado Republican has his way, that includes weed corporations, too.

Republican Sen. Cory Gardner of Colorado said Wednesday that he will file an amendment that would force the IRS to treat weed-related businesses just like any other in the U.S. The amendment still has a long way to go before becoming law, but its inclusion in the tax bill would be a watershed moment for the budding cannabis industry which has long had to operate in the shadows of the black market.

Gardner’s office told VICE News that the amendment will likely be similar to the bipartisan Small Business Tax Equity Act that he signed onto earlier this month. Right now, since marijuana is still illegal at the federal level, weed businesses can’t claim normal tax deductions for things like expenses or hiring veterans despite the drug being legal in eight states plus the District of Columbia and available for medical use in 29. This leads the companies to pay federal taxes at rates of up to 90 percent, nearly three times the current corporate tax rate.

“Our current tax code puts thousands of legal marijuana businesses throughout Colorado at a disadvantage by treating them differently than other businesses across the state,” said Sen. Cory Gardner, announcing his support for the measure earlier this month in a statement. “This commonsense, bipartisan bill will allow small businesses in Colorado and other states that have legal marijuana businesses to grow their operations, create jobs, and boost the economy.”

Back in March, a bipartisan group of legislators in both houses introduced the act, but marijuana insiders say they’re not sure the bills will make it through this first round of reform.

“It’s too soon to say whether it will be included in whatever emerges from the conference committee,” said Mason Tvert who represents the New Federalism Fund, a states-rights focused coalition of marijuana businesses.

The House passed its tax overhaul earlier this month, which did not include the Equity Act, and discussion on the Senate’s pending measure has focused on more general corporate tax rates, pass-through entities, and repealing Obamacare’s individual mandate. Both the House and Senate versions of the Equity Act, meanwhile, still sit in committee.

Republican Sen. Rand Paul, as well as Democrats Ron Wyden and Michael Bennet, the sponsors of the Senate version, did not respond to a request for comment, but at least publicly, they haven’t said the weed tax issue will change their votes on the tax overhaul, where the GOP can only afford to lose two Republican votes. Still, their votes could help push the amendment through if it gets to the floor and some Republicans don’t want to look like they are supporting weed legalization.

The IRS said it did not comment on pending legislation, but Attorney General Jeff Sessions, the nation’s top law enforcement official, is a vocal opponent of further marijuana legalization.