Marijuana, both medical and recreational, has been a constant feature of legislative and legal controversy over the past few years. More than 20 states and the District of Columbia have legalized medicinal usage, and four states—Colorado, Washington, Alaska and Oregon—now regulate sales for recreational purposes. All the while, these states are in major conflict with federal law enforcement. Understanding the states’ tax regimes and regulatory structures is vital for companies involved in the marijuana trade and the companies with which they associate.
Under federal law, marijuana is an illegal substance. The federal government originally banned it in 1937, Marijuana Policy Project Communications Manager Morgan Fox told Bloomberg BNA June 3. In 1970, the Controlled Substances Act classified marijuana as a Schedule I drug, meaning that it is legally considered to have no medical use and has a high risk of abuse.