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Tariffs’ Impact On Some Cannabis Businesses May Erase Any Benefits They See From 280E Tax Relief Under Rescheduling (Op-Ed)

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“The revision removes a major structural penalty, but the tariffs will reshape who gets the profits. Everyone else, the big dispensary companies, could emerge as the main beneficiaries.”

By Justin Leiby, Cannabis Research Institute

With federal cannabis reorganization partially underway and the potential end of 280E tax penalties looming, it’s an open question how much relief the cannabis industry will get. Regardless of the future, 280E is a significant financial impact for cannabis operators.

I conduct an annual survey of cannabis operators for the Illinois Office of Cannabis Regulation, and in the most recent survey operators estimate that 44 percent of their operating expenses in 2024 were not deductible under 280E, Schedules I and II. That it only applies to the drugs listed. Assuming a 21 percent corporate tax rate, that means a penalty of $92 per $1,000 spent.

Under the Trump administration’s current process of moving cannabis to Schedule III, the pain of the 280E penalty has not been distributed equally, and those who suffered the most may reap greater benefits beyond the (hopefully) temporary importance of separating medical and adult operations.

Small operators report more 280E waivers than large firms (45 percent vs. 37 percent of operating expenses), while firms that rely entirely on dispensary operations do as well as those that do not (50 percent vs. 43 percent).

Comparing the impacts of 280E and tariffs

To put the financial impact of the reorganization into context, it should be noted that some of the benefits may never materialize to operators thanks to the impact of tariffs imposed over the past year.

I combine Illinois survey responses with public financial filings to better understand the relative impacts. Like all businesses, cannabis operators have two types of operating costs: the direct costs of acquiring and producing products such as raw materials (“costs of goods sold”) and the indirect costs of operating the business such as rent and insurance (“selling, general and administrative expenses” or “G&A”).

Tariffs primarily affect the larger portion of the former, while 280E primarily affects the latter.

Together, these costs consume 84 cents of every dollar of revenue generated by cannabis operators, paying creditors and non-280E taxes consumes another six cents. I calculate a 280E penalty of three cents on the dollar by multiplying an average write-off of 44 percent, an SG&A percentage of 35 percent, and a US corporate tax rate of 21 percent. Considering the small profit margins of cannabis, the economic benefit of removing the 280E penalty is undeniable.

However, this will be partially or fully offset by tariffs that increase input costs such as packaging, vape hardware and building materials. One in six operators reported increases of 20 percent or more in input costs and more than half reported increases of 5 percent or more.

In my example, even a modest 5 percent increase wipes out most of the gain from 280E penalty relief, and an 18 percent increase wipes out all gains entirely.

Variable and deferred benefits

Like 280E, the fare load is heavier on some operators than others; in this case, cultivation and brewing operations that rely on imported packaging products, construction, and high-tech hardware. One in six cultivation and infusion companies (17 percent) reported input cost increases of more than 20 percent, while dispensary-only companies reported no such impact.

Because dispensary-only operators experience greater tax distortions from 280E and report lower tariff impacts, they will benefit the most from ending the 280E penalty.

Replanning Changes Competitive Landscape

The reorganization removes a large structural penalty, but the tariffs will reshape who takes the profits. All else being equal, large dispensary companies may be the main beneficiaries.

That’s right, observations like this start the debate instead of solving it. Some of the benefits of the rescheduling will not be realized immediately because operators have made long-term strategic choices based on the 280E tax cuts and cannot immediately release those choices.

For example, in the Illinois survey, more than half of operators reported that 280E led them to cut discretionary investments in product development, research, and sustainable technologies necessary to reach a market. Similar percentages indicate a shift to leaner staffing patterns, from security protocols to customer experience and changing facility designs for tax reasons, such as more difficult to limit retail space.

“Who wins” depends on how well operators can adapt to the new landscape.

Justin Leiby, Ph.D., is a professor of accounting at the University of Illinois Gies College of Business and faculty-in-residence at the Cannabis Research Institute. His research and teaching focuses on audit, governance and risk management, and includes extensive collection and analysis of operational and financial data from the cannabis industry.

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Redefining the standards of UK cannabis

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Dalgety Ltd has entered into a partnership with Curaleaf Laboratories to supply pharmaceutical grade cannabis medicines to the UK cannabis market. The arrangement combines Dalgety’s cultivation operations, which are certified to EU-GMP standards, with Curaleaf Laboratories’ pharmaceutical manufacturing and distribution capabilities. According to the companies, this creates a UK-based supply route that does not rely on imported cannabis flowers, as Dalgety cultivates its product in-house. Dalgety claims it was the first company in the UK to grow, manufacture and supply EU-GMP medical cannabis from a single site.

© Curaleaf Laboratories

The growing facility, which is more than 30,000 square feet, is located indoors and uses hydroponic growing methods along with automated lighting, irrigation, humidity and temperature control systems. The company reports that it uses AI-assisted environmental monitoring, which extends the traceability of batches to the final product and compares them to operating standards for air filtration systems. Post-harvest processing is said to follow EU-GMP protocols, including microbial and cannabinoid testing.

The stated goal of this approach is to reduce between-harvest variation in terms of THC and CBD content, terpene profiles, and microbial safety. Dalgety says his cultivation is overseen by staff with experience in horticulture and biochemistry, some of whom have worked on cannabis cultivation projects internationally.

Through a partnership with Curaleaf Laboratories, Dalgety’s UK-grown cannabis is processed and distributed through a UK-based supply chain, rather than imported from overseas. Companies suggest that this arrangement can shorten the time it takes to get products to market compared to importing, and reduce the likelihood of supply disruptions. Because Dalgety and Curaleaf Laboratories are involved in cultivation, manufacturing and distribution, the companies say this oversees the product at every stage, making it clearer for prescribers to see where and how the product was made.

© Curaleaf Laboratories

Dalgety operates to EU-GMP standards and has been subject to regulatory review by the MHRA and the Home Office. Its operations include environmental monitoring, microbial testing, stability testing, controlled drying and curing procedures and quality assurance processes, along with controlled and secure facilities.

The company describes its work as controlled environment farming, hydroponic systems, environmental control technology, and efforts to stabilize cannabis genetics and phenotypes for batch-to-batch consistency.

© Curaleaf Laboratories

Dalgety has also opened its cultivation facilities for visits to healthcare professionals, clinicians, pharmacists, researchers and other industry stakeholders. The company says this is in response to the fact that much of the cannabis historically supplied to UK patients has been grown overseas, which has limited opportunities for UK clinicians to see first-hand the cultivation and quality control processes. These tours aim to provide visitors with information on cultivation standards, EU-GMP compliance procedures, environmental control systems, testing processes and the regulatory framework governing cannabis manufacturing in the UK.

Dalgety and Curaleaf Laboratories describe their partnership as expanding access to UK-grown medical cannabis, improving supply chain reliability and helping to meet sector regulations, placing it in the wider context of growing demand for cannabis-based treatments from UK patients.

For more information:
Curaleaf Laboratories
Email: (email protected)
https://curaleaflaboratories.co.uk/

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Arkansas GOP Governor And Democratic Challenger Agree On Opposing Marijuana Legalization

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“Giving more access to drugs, especially recreational access, does nothing to help or benefit Arkansans.”

Antoinette Grajeda, Arkansas attorney

Contains medical marijuana It generated more than $1 billion since Arkansas voters legalized it in 2016

After the state opened its first dispensary in 2019, thousands of Arkansans joined the program and spent a record $291.1 million on medical marijuana in 2025, according to the state Department of Finance and Administration.

Tax revenue from those sales now supports free breakfast for public school students after lawmakers passed legislation last year.

Medical marijuana programs have expanded across the country, as has recreational marijuana. Two dozen states, including neighboring Missouri, allow recreational marijuana use, according to state legislatures.

Arkansas voters rejected an effort to legalize recreational marijuana in 2022despite the national teams spending millions in support of the measure.

Restrictions on marijuana have been relaxed at the federal level, and the US Department of Justice earlier this year downgraded the drug classification of medicinal cannabis.

Here’s what Arkansas’ gubernatorial candidates — Democratic State Sen. Fred Love, Republican Gov. Sarah Huckabee Sanders and Libertarian Colt Shelby — have to say about legalizing recreational marijuana.

Democratic State Sen. Fred Love

Love said he opposes legalization during a debate at the Arkansas Press Association’s annual conference in June.

Sitting in a crosswalk at her daughter’s school, Love said “marijuana is all over” as the children exited their vehicles. When you grow up in a community where recreational marijuana is present, you see that it doesn’t always have a positive effect, he said.

“I don’t think it’s something I support,” Love said. “I’ve seen the long-term impact.”

While he doesn’t personally support it, Love said he would support legalizing recreational marijuana if Arkansans voted on it.

Libertarian Colt Shelby

Shelby said he’s for whatever Arkansans want, so he would support legalizing recreational marijuana if voters approve.

Shelby said the state’s elected officials have forgotten what matters most is what Arkansans want, which is why she’s running for office.

Although Shelby says she doesn’t smoke weed herself, she says almost everyone knows it and she has the meds.

“It brings a lot of good things, so I won’t say that I’m against it, but let the people decide”, he said in the debate in June.

Republican Governor Sarah Huckabee Sanders

Sanders did not participate in the June debate, but said in an emailed statement that he does not support the legalization of recreational marijuana.

“Giving more access to drugs, especially recreational access, does nothing to help or benefit Arkansans,” Sanders said.

Sanders vetoed a law passed by the Legislature last year dispensaries have been allowed to deliver orders via a delivery vehicle or drive-through window.

The governor signed into law in 2023 the bill protecting the rights for medical marijuana patients and caregivers to obtain a license to carry a concealed handgun.

In 2025, Sanders backed that uses medical marijuana revenue to support free breakfast for all public school students.

This story was first published by the Arkansas Advocate.

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Will the top World Cup expert in the fruit, vegetable, and horticulture sector come from Canada, the U.S. or Belgium?

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FreshPublishers 2026 World Cup Group Stage






The World Cup is coming to an end, with the third-place play-off between France and England on Saturday, and the final between Spain and Argentina the following day. It won’t be long until the grand winner of FreshPublishers’ first World Cup pool is revealed.

© Fresh Publishers

As previously reported, Slim Kooli from Courchesne Laros is the favorite to win the €1,000 prize. He has secured a comfortable lead over Nol Batist of North American Interstate Greenhouse Company, while buyer Bjorn Van Ryckeghem of Deprez Construct is currently in third place.

1 Sim School Spain 1–0 2–1 737 9716
2 Nol Batist France 2–1 1–1 674 9433
3 Bjorn Van Ryckeghem France 2–2 3–1 674 9264
4 Christian Anton Smedshaug England 1–2 1–2 659 9134
5 Perry Springintveld Spain 1–1 2–1 647 9105
6 Willem Tijssen Spain 2–0 2–1 710 9098
7 Hans Borsboom Spain 2–1 2–1 528 9058
8 Bart Triemstra Spain 2–1 2–1 737 9052
9 Youness Bensaid Spain 2–1 1–1 722 8954
10 Vijay Dijkstra Portugal 2–0 2–1 382 8953

However, there have been some surprises during the tournament, and bonus points must be added, so we will keep the suspense a little longer. On Monday we will find out who is the main World Cup announcer in the international fruit, vegetable and horticulture sector…



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