BUZ INVESTORS States Where Marijuana Is Likely to Be Legalized Mr. Market is going gaga over his newfound money-making idea. He’s investing in pot stocks ahead of marijuana legalization. There have been hits and misses but his bets have largely paid off well. Marijuana stocks have been some of the best performing investments this year.
But following Mr. Market is not always a good idea. Like any other investment idea, this one also comes with pitfalls.
Yes, it’s true. One day the sun shines bright on speculations of marijuana legalization. The next day, political statements of Trump aides bring dark clouds on the horizon. This uncertainty has added to the risk of weed stocks. And with greater risk have come greater rewards for many.
It’s no secret that Trump’s appointed attorney general, Jeff Sessions, is building a wall to keep weed out of the country. He weighs marijuana—a seemingly harmless drug—with alcohol and heroin, which are known to have killed far too many. (Source: “Senators held a hearing to remind you that ‘good people don’t smoke marijuana’ (yes, really),” The Washington Post, April 5, 2016.)
Now, the anti-marijuana drug policy is keeping them from doing so. There are two reasons why. First off, these marijuana companies can only make money if they are allowed to sell. If their product is banned, who’s going to buy it? Only daredevils and criminals.
Two, as long as marijuana stays illegal, these companies stay tax-disadvantaged. Yes, in this sorry state of affairs for marijuana companies is another little hitch.
Marijuana companies receive unfair tax treatment because the federal government doesn’t recognize their product as legal. These companies are taxed on their top line, not bottom line. This means their gross profits are taxed, instead of net profits, which is the norm for all other businesses. The result is obvious; their profitability gets hurt.
Colorado was actually the first state to accept marijuana as legal. When I say “legal,” I mean both for its medical and recreational use. Today, eight U.S. states and the District have legalized marijuana.
Rumor has it that Delaware and Rhode Island are probably the next two states to smoke legal weed as early as next year. True or not, here are the seven states highly likely to approve marijuana’s legal status as a recreational drug.
|New Jersey||New Mexico||Maryland|
legalizing marijuana could be very profitable for the government. It makes sense for a businessman to take his cut than let the opportunity pass under the radar. All that tax money collected could be put to better use (like building walls, maybe?).
Secondly, legalizing the drug kills its black market. It takes money out of the hands of criminals and drug mafia and into the hands of government-controlled tax-paying businesses (thus creating more jobs?).
Finally, it cuts down on non-violent petty arrests. Youngsters will no longer have to carry a criminal record for being found in possession of a small amount of an ostensibly harmless drug. This will allow the cops to direct their focus on more important tasks (like catching illegal immigrants?).
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