Author: CannabisNewsWire (CNW)

About CannabisNewsWire CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge. To receive SMS text alerts from CannabisNewsWire, text “CANNABIS” to 21000 (U.S. Mobile Phones Only) For more information please visit https://www.CannabisNewsWire.com Please see full terms of use and disclaimers on the CannabisNewsWire website applicable to all content provided by CNW, wherever published or re-published: http://CNW.fm/Disclaimer

420 with CNW — Federal Report Says Youth Cannabis Use Stable Despite State-Level Legalization

Most opponents of cannabis reform had one argument against pro-cannabis legislation: passing state-level recreational cannabis bills would inevitably lead to increased use among the youth. They argued that marijuana was a gateway drug and that by making the controversial plant more accessible, states would see their youth use marijuana and other “hard drugs” at much higher rates. However, most studies have found the situation on the ground to be entirely different, with rates of youth use in states with recreational cannabis markets remaining the same and, in some cases, even going down.

A recent federal report from the U.S. Department of Education’s National Center for Education Statistics (“NCES”) corroborates what previous studies have concluded. Marijuana legalization at the state level has not led to increased cannabis use among the country’s youth. To arrive at this conclusion, NCES analyzed youth surveys of high school students that were conducted from 2009, long before any state had launched recreational cannabis sales, to 2019. The report found that among the percentage of teenagers in grades 9-12 who reported using cannabis at least once in the past 30 days, there was no measurable difference from 2009 to 2019.

The data, which was sourced from the Youth Risk Behavior Surveillance System, showed that although 16 states have legalized recreational cannabis within the past decade, youth access to the drug remained stable. There have been no major changes in the percentage of teenagers who admit that they have been sold, gifted or offered illicit drugs on school grounds in the preceding 30 days. When the data is compared to the timeline of legalization, things get even more interesting.

Back in 2009 when there were no adult-use markets in the country, 21% of high school students reported having consumed cannabis within the past 30 days. A decade later, when the United States had nearly a dozen state-level recreational cannabis markets, 22% of high schoolers admitted to recently consuming cannabis. The highest reported rate of cannabis use among the youth was in 2011, and at that point, no state had legalized recreational cannabis. Consequently, the NCES concluded, there was no “measurable difference: in the percentage of students who said they had access to illicit drugs on school grounds between 2009 and 2019.

With most states that allow recreational cannabis placing age limits (usually 21 years) and requiring customers to provide IDs before purchasing cannabis, youth may have even reduced access to cannabis than they did before adult-use cannabis was legal. A lot of misinformation has been circulating about marijuana, and such federal reports help industry players such as Hero Technologies Inc. (OTC: HENC) to have one less myth to debunk.

NOTE TO INVESTORS: The latest news and updates relating to Hero Technologies Inc. (OTC: HENC) are available in the company’s newsroom at https://cnw.fm/HENC

About CNW420

CNW420 spotlights the latest developments in the rapidly evolving cannabis industry through the release of two informative articles each business day. Our concise, informative content serves as a gateway for investors interested in the legalized cannabis sector and provides updates on how regulatory developments may impact financial markets. Articles are released each business day at 4:20 a.m. and 4:20 p.m. Eastern – our tribute to the time synonymous with cannabis culture. If marijuana and the burgeoning industry surrounding it are on your radar, CNW420 is for you! Check back daily to stay up-to-date on the latest milestones in the fast -changing world of cannabis.

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420 with CNW — Legislation to Federally Legalize Cannabis Reintroduced in the House

Last week, a legislation to promote social equity in the cannabis industry and federally legalize cannabis was tabled in the House. The bill was filed with some amendments and was sponsored by Jerrold Nadler, chair of the Judiciary Committee.

The legislation would establish a federal tax on cannabis with revenue generated being allocated to support various programs and community reinvestment, allow individuals with marijuana convictions to have their records expunged, and remove cannabis from the Controlled Substances Act.

The Marijuana Opportunity, Reinvestment and Expungement Act (“MORE”), which didn’t advance in the Senate during the last legislative term, was approved in the House. Despite this, cannabis advocates are hopeful that the change in policy can be enacted now that Democrats run the White House and both chambers, and as more states are legalizing the plant.

Nadler stated that since he introduced the MORE Act, various states in the country, including New York, have legalized cannabis. He added that he was proud to introduce the act to decriminalize cannabis at the federal level, invest in communities that have been disproportionately affected by the drug war and remove the burden of cannabis convictions on the country’s citizens.

Some of the new initiative’s language was amended to extend to job training, financial literacy programs and loans under the SBA Aid (Small Business Administration) to assist individuals who have been affected by the drug war to pursue business opportunities in every industry, including the marijuana industry.

Apart from this, major provisions in the initiative remain unchanged, including preventing federal agencies from refusing to provide security clearance and public benefits to immigrants, protecting immigrants from being denied citizenship over marijuana and establishing a pathway for resentencing for individuals who’ve been incarcerated for cannabis offenses.

DPA Office of National Affairs director Maritza Perez stated that it was clear that the House understood the urgency of this social justice and racial issue. She added that the communities that had been the most affected by cannabis prohibition had waited a long time for justice.

Concurrently, Senate leadership is making preparations to introduce another reform initiative that will have similar goals. Sen. Cory Booker, chair of the Senate Finance Committee Ron Wyden and Senate Majority Leader Chuck Schumer have been working on the measure for some time now. Wyden recently revealed that it would be introduced soon.

Earlier in March, Schumer noted that their proposal would seek to limit the ability of large tobacco and alcohol companies from overtaking the industry, while also prioritizing small businesses and in particular, those owned by individuals from communities that have been affected the most by marijuana prohibition.

If this effort to get cannabis federally legalized succeeds, the creation of nearly uniform cannabis laws across the country would be a great help to all sector players, including Sonoma Biologics Corp., as the market they can serve increases.

NOTE TO INVESTORS: The latest news and updates relating to Sonoma Biologics Corp. are available in the company’s newsroom at https://cnw.fm/Sonoma

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420 with CNW — Smokable Medical Cannabis Bill Enacted into Law in Minnesota

Although more than 30 states have passed legislation allowing the use of marijuana for medical purposes, the language in each of these medical cannabis bills varies widely. But one provision that several of these states share is a ban against smokable medical marijuana, forcing qualified patients to use other forms of consumption such as oils and tinctures. In Minnesota, however, patients will soon be able to access smokable medical cannabis after the governor signed a large-scale bill that expanded the state’s medical marijuana program.

Among other things, this bill includes provisions that grant medical marijuana patients access to smokable products. The legislation was sponsored by Minnesota House Majority Leader Ryan Winkler and was approved by legislators less than a fortnight ago.

The broader medical cannabis bill was approved by a bicameral conference committee as part of an omnibus health bill, with the House and Senate passing it in a 77 to 57 and 67 to 1 vote, respectively. Now that Minnesota Governor Tim Walz has signed the bill into law, it must take effect by March 1, 2022.

Once it does, adults 21 years and older will be granted access to smokable cannabis flowers. Aside from allowing smokable cannabis, the legislation will also allow medical marijuana dispensaries to provide curbside pickup services. Additionally, it increases the number of registered patients designated caregivers can serve at once from just one to six. Winkler, who has been a major proponent of cannabis reform, predicted that the push for broader cannabis reform in the conservative state, especially adult-use cannabis, would inevitably lead to compromise legislation such as the expanded medical cannabis bill that is now state law.

Aside from the medical marijuana bill, Winkler is also behind a full legalization bill that advanced through the House but stalled in the Republican-controlled Senate. The legislation would allow adults aged 21 and older to buy and possess a maximum of one and a half ounces of marijuana. Additionally, adults would be allowed to grow a maximum of eight cannabis plants at home, with four of them being mature. Calling it the best cannabis legalization bill in the country, Winkler said that it would address the harms of the failed war on drugs by prioritizing social equity, promoting diversity in the licensing process and preventing corporate giants from taking over the adult-use industry once launched.

Just across the state lines, the Louisiana House approved a bill that would allow patients to access smokable cannabis, and that bill is currently awaiting action on the Senate floor. On the other hand, Alabama’s governor recently signed a medical cannabis bill that includes a provision banning smokable medical marijuana.

As many states and countries enact reforms that allow the use of marijuana in some form, the benefits of companies such as Pac Roots Cannabis Corp. (CSE: PACR) (OTCQB: PACRF) (FSE: 4XM) operating are becoming apparent as high-paying jobs and other industries emerge around the marijuana sector.

NOTE TO INVESTORS: The latest news and updates relating to Pac Roots Cannabis Corp. (CSE: PACR) (OTCQB: PACRF) (FSE: 4XM) are available in the company’s newsroom at http://cnw.fm/PACR

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420 with CNW — Illinois Cannabis Equity Licensing Bill Passed by House

Last week, a bill to create new cannabis dispensary licenses in the state of Illinois was approved by the House. The bill, HB 1443, was sponsored by Rep. La Shawn Ford and will be used to address the shortcomings of the Cannabis Regulation and Tax Act of 2019, specifically the license lottery that has been delayed by legal disputes, controversy and the coronavirus pandemic, for more than a year.

The measure would establish a pair of new cannabis dispensary lotteries, providing more than 50 licenses while addressing concerns about the initial 75 licenses cited in the 2019 legislation.

The initiative was approved by the House with bipartisan opposition as well as support. For instance, Carol Ammons, the Democratic Representative of Urbana, asked if the legislation would achieve the social equity spirit of the first cannabis legalization legislation. Ford explained that his measure was the best way to increase the chances of local brown and Black communities in the state gaining access to the burgeoning cannabis industry.

The licenses established by the 2019 legislation were to be granted in May of last year. However, the coronavirus outbreak hindered this. Backlash over how some applicants received their licenses prompted further delay with lawsuits against the state delaying the move for a third time. The finalists of the preliminary lottery had sued the state after Governor JB Pritzker declared that the applications didn’t meet the requirements and would have to be rescored and edited.

Initially, licenses were to be awarded in order of applicant scores, with applicants that received similar scores entering tiebreaker lotteries. However, only 20 or so applicants out of the 900 that applied received perfect scores, making them eligible for the lottery.

Under the new legislation, the 55 licenses would be provided via a Qualifying Applicant Lottery, which would be accessible to applicants that received a score of 85% or higher in the earlier submissions. This would allow companies that either weren’t included in the first lottery or didn’t receive perfect scores an additional chance at receiving dispensary licenses.

The other 55 licenses will be provided via a social equity justice lottery. The eligibility criteria states that to be eligible, one must qualify as a social equity applicant and have a score of 85% or more on their submission. This means that 51% of the company’s ownership must be a member of a family that has been affected by the drug war, have been arrested and/or convicted of a cannabis crime eligible for expungement or be somebody who lived in an area affected by the drug war for a decade.

As applicants vie to win the social equity licenses, additional opportunities are also available in the federally legal niche of cannabis products that don’t contain THC. An example in this regard is the success registered by The Alkaline Water Company Inc. (NASDAQ: WTER) (CSE: WTER) which manufactures, among other products CBD gummies, drinks and tinctures.

NOTE TO INVESTORS: The latest news and updates relating to The Alkaline Water Company Inc. (NASDAQ: WTER) (CSE: WTER) are available in the company’s newsroom at http://cnw.fm/WTER

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CannabisNewsBreaks – Pure Extracts Technologies Corp. (CSE: PULL) (OTC: PRXTF) (XFRA: A2QJAJ) Announces Production of 1 Gram FSO Vape Cartridges

Pure Extracts Technologies (CSE: PULL) (OTC: PRXTF) (XFRA: A2QJAJ) wholly owned subsidiary, Pure Extract Manufacturing Corp., has developed a proprietary 1 gram, full-spectrum oil (“FSO”) vape cartridge. Pure Extracts, a plant-based extraction company focused on cannabis, hemp, functional mushrooms and the rapidly emerging psychedelic sector, announced that production has begun on the cartridges, which will be distributed and sold in the Canadian retail market. The cartridges will be filled with a variety of PULL’s 30-plus proprietary cannabis FSO formulations, including Super Lemon Haze, Grand Daddy Purple and GSK. Pure Extracts uses 510 vape cartridges that are produced by a global manufacturer and specifically chosen for the quality of their component parts, including their fit, finish and performance characteristics when paired with PULL’s oil concentrates. In the announcement, the company noted a growing consumer preference for larger cartridges, observing that demand for Pure Pulls branded vape carts is strong. “We are proud to be a leading innovator in the cannabis vape sector,” said Pure Extracts CEO Ben Nikolaevsky in the press release. “The combination of a larger form factor with our exceptional cannabis extracts will definitely build on the loyal following Pure Pulls already has in place.”

To view the full press release, visit https://cnw.fm/kd8Ku

About Pure Extracts Technologies Corp.

Pure Extracts features an all-new, state-of-the-art processing facility located just 20 minutes north of world-famous Whistler, British Columbia. The bespoke facility has been constructed to European Union GMP standards aiming towards export sales of products and formulations, including those currently restricted in Canada, into European jurisdictions where they are legally available. On Sept. 25, 2020, Pure Extracts was granted its Standard Processing License by Health Canada under the Cannabis Act. In addition, the company’s stock began trading on the Canadian Securities Exchange (“CSE”) on Nov. 5, 2020. For more information about the company, please visit www.PureExtractsCorp.com.

NOTE TO INVESTORS: The latest news and updates relating to PULL are available in the company’s newsroom at https://cnw.fm/PULL

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

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420 with CNW — Report Finds Legal Cannabis Sales Have Raked in $8 Billion in Taxes

The young but fast-growing state-legal cannabis industry has proven to be quite a lucrative space. While opponents of cannabis reform offered a slew of reasons against legalizing cannabis such as increased drug use and criminal activity, statistics have proven them wrong. Not only has legal adult-use cannabis created more than 200,000 new job opportunities, becoming one of the fastest-growing job markets in the country, but it has also provided states with billions of dollars in tax revenue.

According to a recent report from the Marijuana Policy Project (“MPP”), recreational cannabis has earned states close to $8 billion in tax revenue since adult-use sales began in 2014. To arrive at this figure, MPP studied 18 states with legal recreational cannabis markets, looking closely at their tax structures and revenue streams since they launched recreational cannabis sales. Although seven of these states have yet to launch sales of adult-use cannabis, the MPP concluded that cannabis provides a steady and growing stream of revenue for states that have legalized recreational marijuana.

In 2020 alone, taxes from cannabis sales earned states with legal markets around $2.7 billion, helping to beef up their coffers as other industries struggled to survive amid the coronavirus pandemic and subsequent lockdowns. Some states are home to insanely lucrative cannabis sectors, with states such as California earning more than $1 billion from cannabis sales in 2020.

Illinois, which launched its recreational marijuana market in January 2020, has been consistently breaking monthly sales records and is poised to take in a whopping $1 billion in cannabis tax revenue this year after only two years of legal sales. In fact, Illinois’ legal cannabis sector has proven so profitable that last quarter cannabis earned the state more tax revenue than alcohol for the first time. However, the report from MPP did not include local taxes that may be imposed by municipalities. In Denver, for instance, residents have to pay an extra 5.5% tax, raising hundreds of thousands of dollars for the city.

The funds generated from adult-use cannabis sales have been directed toward various causes, MPP says. Colorado, home to one of the country’s most profitable cannabis markets, has invested $404.5 million in its public school system, while California has earmarked $100 million in cannabis tax revenue for communities that suffered the brunt of the decades-long war on drugs. In Oregon, 40% of marijuana tax dollars goes to public education while 25% is used to fund programs that support mental health treatment.

Different segments of the cannabis industry, such as the segment of cannabis-infused drinks, are growing at different rates as the cannabis industry matures, and that means that the sales recorded by manufacturers such as BevCanna Enterprises Inc. (CSE: BEV) (OTCQB: BVNNF) (FSE: 7BC) and others are set to grow over the foreseeable future. With that growth comes more taxes.

NOTE TO INVESTORS: The latest news and updates relating to BevCanna Enterprises Inc. (CSE: BEV) (OTCQB: BVNNF) (FSE: 7BC) are available in the company’s newsroom at http://cnw.fm/BVNNF

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420 with CNW — Wyoming Supreme Court Admonishes Prosecutor for Allowing False Testimony to Be Presented in Court

The Supreme Court in the state of Wyoming has admonished an attorney in Cheyenne for permitting a DCI agent to make a false testimony in a case against hemp growers.

Last year during a hearing of the case, Special Agent Jon Briggs of the Division of Criminal Investigation gave a false testimony about an exchange he had with one of the defendants when officers conducted a raid on the operation. The defendant, a contract farmer by the name of Brock Dyke, presented to the agent test results that showed that the hemp crop was legal during the raid, which took place in 2019. However, during preliminary hearings, Briggs asserted that the tests possibly showed that the hemp was above the legal limit of THC, which was false. The case sought to prosecute hemp growers as cannabis traffickers.

Hemp has been legal in Wyoming since 2017. However, under the state’s law, hemp plants shouldn’t have a concentration of more than 0.3% THC.

David Singleton, the senior assistant district attorney in Laramie County, was the presiding prosecutor in the case.

After the hearing, Tom Jubin, who was the defendant’s attorney, asked Singleton and Briggs to correct the record. However, the two tried to reinforce the false testimony once more in a court hearing a few months later.

The order of public censure released by the Supreme Court shows that during this hearing, which was held in August, Briggs not only reiterated his false testimony but also stated that he was not aware of the request by the defendant’s attorney. For his part, Singleton acknowledged that he violated the state’s judiciary rules of professional conduct and agreed to pay administrative fees to the Wyoming State Bar.

Brock Dyke revealed in an interview that during the raid, which occurred in November 2019, the DCI seized more than 600 pounds of hemp, noting that law enforcement officers armed with rifles and in tactical gear carried out the operation.

Singleton was trying to charge the hemp farmers whose operations were raided with drug trafficking charges. However, the attempt was thwarted after Antoinette Williams, the circuit court judge in Laramie County, dismissed the charges during the hearing in August.

It is yet to be confirmed whether Briggs will be charged for giving a false testimony. Additionally, Forrest Williams, director of the DCI, hasn’t responded to a request for a comment.

This Wyoming case highlights some of the challenges that cannabis sector players face as they conduct lawful activities and shows how much additional reforms are needed before cannabis entities such as Chalice Brands Ltd. (CSE: CHAL) (OTCQB: GLDFF) can say they are treated equally with other legal industries.

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420 with CNW — Cannabis Sector Expected to Boost US Economy by $92 Billion in 2021

According to an analysis published by MJBizFactbook, the cannabis sector is projected to add approximately $92 billion to the general U.S. economy this year. This figure was arrived at after crunching the numbers on the marijuana taxes and fees, jobs created, demand for real estate, and other knock-on factors.

This projected impact of the cannabis industry would mark an increase of about 30 percent from the total impact of the sector upon the economy in 2020. In 2025, the broader U.S. economy will see a boost of $160 billion from this industry, according to the analysts.

To arrive at the sector’s approximate impact upon the economy, the team at MJBizFactbook measured similar industries before applying a standardized 3.5 multiplier on the anticipated retail sales of recreational as well as medical cannabis. However, these numbers aren’t set in stone since the analysts admit that the cannabis industry is unique given that its influence stretches to the agriculture industry, retail segment, as well as the manufacturing sector.

Under normal circumstances, the total size of a given industry is calculated by computing the total revenues generated during retail sales along every step of the supply chain of that industry. But, such a computation doesn’t paint the entire picture of the cannabis industry’s impact. Instead, a multiplier is used. In this particular case, the analysts believe that each dollar that a patient or recreational user of marijuana spends at a retail outlet translates into an extra $2.5 injected into the local economy.

Those additional dollars added to local economies arise because employees of cannabis firms spend on food, transportation, housing, entertainment as well as other necessities of life. Furthermore, buyers of cannabis products also pay local and state taxes or fees.

This increases the impact of their purchase upon the economy since those tax dollars go to maintaining schools, building infrastructure and meeting other expenses at state or even federal level. This is where the broader U.S. economy benefits, according to the MJBizFactbook team.

The analysts also point out that there will be a variation of the impact based on several factors, such as the kind of cannabis market, the size of that market as well as the maturity of the market.

For instance, California, which is the largest U.S. market of marijuana, is expected to see an injection of a whopping $20 billion into its economy this year. This is in sharp contrast with other states, such as Colorado, Oregon, Illinois and Washington which are estimated to inject approximately $10 billion into their economies from the marijuana industry within a few years from now.

When the sector’s economic impact is looked at on a per capita basis, California doesn’t shine as much since other states deliver a bigger per capita contribution from the marijuana industry.

A case in point cited in the analysis is Nevada whose per capita impact is $1,917 while that of California pales in comparison at $500 and yet the total dollar amount injected into the California economy is huge ($20 billion).

While the overall estimates of the economic impact of legal marijuana programs aren’t very accurate, they provide a general picture of what is happening, and things are looking up!

Those projections of the expected contribution of cannabis to the economy can be brought to life when one looks at how a number of cannabis firms like Gage Growth Corp. (CSE: GAGE) (OTC: GAEGF) (d.b.a. Gage Cannabis) are growing and hiring more and more employees at their different locations.

NOTE TO INVESTORS: The latest news and updates relating to Gage Growth Corp. (CSE: GAGE) (OTC: GAEGF) (d.b.a. Gage Cannabis) are available in the company’s newsroom at https://cnw.fm/GAGE

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420 with CNW — 4 Powerful Lessons Marijuana Extractors Learned During the Pandemic

When the Covid-19 pandemic broke out, the hemp and marijuana industries took a huge hit because they relied on overseas sources, particularly China, for everything ranging from processing equipment to cartridges and even carrier oils. If marijuana processors were to stay in business, they needed to change things fast. We discuss below some of the key lessons that extractors learned as the pandemic raged on.

Diversifying Supply Sources

Clear Cannabis, a Denver-based manufacturer of CBD and THC concentrates, saw its supply chains disrupted in a major way. The board chair, Richard Batenburg, explains that they had to take a hard look at every aspect of their supply chains and then look for options to plug any gaps observed. He adds that they diversified their suppliers to such an extent that where they initially had four suppliers, they bumped them up to sixteen.

This approach to diversifying supply sources has helped extractors to maintain robust supply chains amidst the uncertainties brought by the pandemic.

Streamlining Processes

Another vital lesson was the importance of streamlining processes in order to shed any avoidable step or procedure. By looking for ways to streamline their processes, extractors were able to find opportunities to implement automation in addition to saving time. Streamlining processes can also reduce personnel demand.

For instance, Clear Cannabis opted to merge the operations of the design team with those of the packaging team so that less time was spent waiting for designs and then proofreading them before they are approved.

Overhauling Delivery Systems

Marijuana extractors quickly realized that their headaches didn’t end with sourcing inputs. Instead, a whole new dilemma presented itself in the form of how to deliver finished products to clients. For instance, products would remain stuck at shipping hubs for much longer than was expected and clients would repeatedly call asking about their shipments.

To deal with this problem, extractors learned to switch from standard shipping to priority shipping. While this added costs, it ensured that products were delivered on time.

Putting Employees First

Concerns about employee safety also made cannabis extraction firms to make changes and intensify their focus on putting employees first. For some, this translated into abandoning the top-down management system to one in which power was delegated downwards and small teams worked almost independently.

Oregrown, an Oregon-based extraction firm, says that they started having what they called “management councils” entailing holding separate meetings with various divisions of the firm. The surprising result of making this switch was that teams became more productive since they didn’t always have to wait for “orders from above.”

Not surprisingly, many of these adaptations are likely to last long after the pandemic is gone since they have changed operations for the better.

Having lived through the worst of the pandemic, industry players like Pure Extracts Technologies Corp. (CSE: PULL) (OTC: PRXTF) are certainly better placed to navigate future crises if they ever occur.

NOTE TO INVESTORS: The latest news and updates relating to Pure Extracts Technologies Corp. (CSE: PULL) (OTC: PRXTF) are available in the company’s newsroom at https://cnw.fm/PULL

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420 with CNW — Missouri Legislators Advance Medical Cannabis Tax Deduction Bill to Governor’s Desk

In 2018, voters in the state of Missouri legalized medical cannabis. Despite this, the sale, distribution and cultivation of cannabis is still illegal in the state under federal law. This has created some challenges for the infant industry. For instance, cannabis companies in the state aren’t allowed to deduct business expenses on their taxes, despite being legal businesses.

During a Senate hearing held earlier in this year, Senator Denny Hoskins raised the issue, noting that cannabis business owners who weren’t allowed to deduct business expenses on their tax returns had to pay significantly higher taxes.

In the legislative session that recently ended, legislators in the state of Missouri approved a bill that will allow medical cannabis companies to deduct business expenses on their tax returns. The legislation, which was approved with almost no opposition, has been advanced to Gov. Mike Parson’s desk.

This bill will permit medical cannabis businesses that are authorized under the state’s constitution to claim income tax deductions in any amount equal to their expenditures. It should be noted, however, that a provision in the tax code prevents deductions for expenses that are sustained while operating any business or trade that is made up of or involves the trafficking of controlled substances.

While the federal law is yet to be altered, this legislation will ease some of the burden that cannabis business owners in the state bear. Under the federal law classification of substances, cannabis is categorized as a Schedule I controlled substance. This clause is used by the Internal Revenue Service (“IRS”) to prevent marijuana businesses from deducting business expenses on their returns.

Missouri Medical Cannabis Trade Association executive director Andrew Mullins noted that by making this change, legislators in the state were putting medical marijuana businesses on a level playing field with other small businesses in the state in terms of taxes.

CPA David Smith, who works with various medical cannabis companies, noted that the current law could mean an effective tax rate for businesses of 70% or more, adding that some companies may be subject to income taxes, despite operating at a loss.

Hippos Cannabis CEO Nicholas Rinella explained that this was because, without the deductions, companies had to pay taxes on gross profit instead of gross income. He added that sometimes, expenses could outweigh the income of a business, particularly if it was just starting out. Rinella also noted that this taxation level limited the industry’s ability to reinvest in communities, create employment opportunities and serve patients.

This change in Missouri is a much-needed one in all jurisdictions where cannabis companies operate. As those tax deductions are rolled out, companies such as Hero Technologies Inc. (OTC: HENC) will be at par with other licensed businesses.

NOTE TO INVESTORS: The latest news and updates relating to Hero Technologies Inc. (OTC: HENC) are available in the company’s newsroom at https://cnw.fm/HENC

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