Reps Reintroduce the Marijuana Business Access to Banking Act
May 1st, 2015
Policy, Top News
U.S. Reps. Ed Perlmutter, Denny Heck, and a bipartisan group of 16 other Democrats and Republicans reintroduced the Marijuana Businesses Access to Banking Act of 2015 (H.R. 2076) earlier this week to “create protections for depository institutions that provide financial services to marijuana-related business”.
In reality, the bill would do much more to help the cannabis industry than depository institutions. Many financial institutions have been unwilling to deal with the legalized cannabis industry, despite President Obama’s guidance in 2014, because there are no clear rules regarding the federal treatment of these transactions – they could be considered racketeering or money laundering.
“First and foremost, this is an issue of public safety,” said Perlmutter in an interview with The Hill. “Not only are the proprietors at risk, but the employees and customers are also at risk of serious and violent crimes.”
Rep. Perlmutter is alluding to the fact that many cannabis businesses are forced to transact in cash, which is then stored on-premise in a vault, since there are no other options. Storing these large amounts of cash puts the establishment at risk of violent robberies aimed at stealing these funds from dispensaries. With the ability to deposit money in banking institutions, these problems could be entirely avoided.
The other big problem is that money that’s not held in a financial institution is much harder to track when it comes to calculating sales and income taxes. By making it clear that banks can hold this capital, government regulators would have a much easier time determining how much is owed in tax and ensuring that these businesses are paying their fair share.
“Forcing businesses into cash-only territory is a dangerous step away from legitimacy, transparency, and regulation and a huge step towards crime, tax evasion, and access to minors,” added Rep. Heck in The Hill interview.
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