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In a swift, almost frenzied surge, cannabis stocks soared following Tuesday’s news that the DEA intends to begin the process of moving marijuana from its onerous Schedule I designation to Schedule III.
One of the major benefits of this long-awaited move lies in the expected changes in the tax law.
If marijuana transitions from Schedule I to III, cannabis companies will be able to write off standard corporate deductions. That’s a benefit unfairly denied to them for years, forcing them to pay exorbitant taxes.
Green Market noted that some companies — Green Thumb Industries GTBIF, Verano Holdings VRNOF and Cresco Labs CRLBF — could boost their bottom lines by $70 million to $100 million potentially starting this year.
This rescheduling offers a much-needed reprieve for an industry beleaguered by plummeting prices, fierce competition, and burdensome taxes.
“Taxes were strangling these companies. Now all the sudden we’re talking about a growth sector again,” Morgan Paxhia told the outlet. As co-founder of Poseidon Asset Management, Paxhia has been a regular guest at Benzinga’s Cannabis Capital Conferences.
Speaking of which, anyone wanting to learn more about the future of the cannabis industry and how or if it’s a great time to invest should plan to attend the Benzinga
