Ohio voters smoked Issue 3. Our neighbors, however, have triumphed their own legalization initiatives; residents of Alaska, Oregon, Colorado, and the District of Columbia, can legally purchase marijuana. Better yet – they can tax it.
On any other Friday, the Internal Revenue Service would clap its fudge-fingered hands and down its share of the candy, yet this is no such ordinary circumstance.
From a federal perspective, marijuana is still very much illegal. It has been for nearly 80 years, and it is classified as a Schedule 1 drug under national law, which according to the Drug Enforcement Administration, includes “drugs with no currently accepted medical use and a high potential for abuse.”
Enough opposition to such a classification exists to legalize, but banks quiver. They fear being shut down for money laundering, or finagling ill-gotten funds to appear legal, and refuse to open accounts for the local marijuana farmer, the local marijuana industrialist.
Visa and MasterCard have spurned him, and their disallowal of credit transactions has led to another green contraband – cash.
That income, however stealable, has to make it to the bank somehow, and no worker desires a briefcase-to-back-door-of-bank transaction.
The marijuana industry, then, is a handcuffed business: it has no means with which to follow the law. Its financial difficulty extends even to paying its employees, according to the New York Times, and as April 15 approaches, neither the industry nor its employees will be prepared. For them, federal withholding is an impossibility, meaning that the federal government has not kept a sliver of any paycheck for income taxes.
When the fifteenth arrives, it’s time to pay big.
Of course, this is of no consequence to our alleyway dealers, for none of their Quentin Tarantino transactions would go on the books anyway. Yet how can the upstart citizen from Colorado whose calling in life is to grow grass be expected to survive?
The federal government, busy lifting faux-hawked babies and begging for dear Donald’s autograph, has left the fine print of legalization to the states – a wise decision. But so long as state governments and state industries are subject to federal economics, contingency plans must be implemented.
If the federal government hopes to keep this nascent enterprise under its eye, let alone reap its share of the cut, it needs to okay basic banking protocol. No one is calling for pan-legalization, a stamp of approval, but if weeds grow too long outside fences, their roots will be too deep to unearth.