President Donald Trump and his Department of Justice took an important step towards recognizing medical benefits for cannabis by reclassifying medical marijuana to a Schedule III drug. That order immediately legitimized businesses operating in the medical cannabis space, but it explicitly did not apply to recreational cannabis businesses.
So what does that mean for businesses and customers in New Mexico’s cannabis industry where both medical and recreational products are sold from the same stores?
Our Julian Paras and Sara Atencio-Gonzales set out to talk to Arin Goold, owner of Mama and the Girls dispensary at 915 Yale Blvd. in Southeast Albuquerque to see what it means.
The takeaway:
- Owners of medical-only cannabis companies will no longer be prohibited from deducting salaries or costs of goods for medical cannabis products they sell. That means thousands of dollars in tax savings annually for these businesses.
But there’s a catch: those deductions only appear to apply to medical cannabis businesses and almost all of New Mexico’s licensed companies provide both medical and adult-use recreational products. Neither the DOJ nor the IRS gave guidance today on if or how those companies could handle taxes going forward.
Some growers could move into the medical market to supply cannabis for pharmaceutical research. New Mexico is one of the few states with a cannabis research licensing structure so local companies may be among the first to take advantage of this new opportunity. - For customer, nothing changes – at least not for now. But medical cannabis patients with a valid prescription will likely face less fear that their medicine will be seized in federal areas including Border Patrol checkpoints and during TSA screenings at airports. Again, those roles aren’t written yet, so it’s best to wait and see.
- The medical/recreational difference may disappear anyway before the end of the year because the DOJ set a date in late June for comments on final decisions that could reschedule all cannabis, not just medical.