Cannabis farmers push for elimination of THC tax in New York

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The illicit market is hurting legal operations, and tax changes could help shift the industry

On Tuesday, members of New York’s cannabis industry, spanning from growers to distributors, congregated on Capitol Hill to push for stricter regulation of the thousands of marijuana vendors running rampant. They seek a set of guidelines that they argue will better equip them to thrive in adverse conditions and navigate the uncharted waters of this emerging market.

Two years ago, the state approved laws to regulate the usage and sale of marijuana for recreational purposes, which ignited anticipation among entrepreneurs that the sector would become operational within a few months. However, the process of obtaining state-issued licenses has come to a halt. Despite the legalization of recreational marijuana, only five retail stores have secured licensing, and there are still no official state directives on the matter.

The financial crisis has posed an immediate threat to the farms most impacted by the sluggish pace of export to market stalls, as farmers stated. Brittany Carbone, a hemp farmer from Tioga County, highlighted how this has hampered profits and put businesses at risk.

According to Carbone, the current surge in cannabis product production by cultivators during spring has overwhelmed the state’s five retailers. They are unable to cope with the high volume of supply.

The state’s Office of Cannabis Control has revealed its strategy to increase the number of primary business licenses available from a mere 150 to 300. This landmark decision has witnessed an influx in location permits issued to various merchants, with two of them tipped to open their stores soon, right in the heart of the capital region.

As per lawmakers, even though there are thousands of unlawful cannabis dispensaries flourishing throughout the state, licensed retailers have to battle them. This happens because all legal cannabis items must distinctly display their THC potency, leading to inflated costs. Due to these factors, the demand for illegal suppliers is still high among consumers. The senator representing the state supports this law.

State Representative Jeremy Cooney, a member of the Democratic Party hailing from Rochester, has made it his primary objective to repeal the energy tax in this year’s legislative session. Cooney has come up with a proposition to substitute this tax with a flat state tax that operates similarly to the various strengths of alcohol products. Damien Cornwell, who oversees one of the initial franchise stores located in upstate New York, claims that numerous franchise businesses are damaging the industry.

He cautioned that the law may not be enforced by manufacturers, rendering the market flawed in its intended purpose of aiding those affected by harsh marijuana legislation.