The Obama-era rules have been reversed by Jeff Sessions, but there may still be hope for marijuana businesses.
The Obama-era rules restricted the U.S. Federal Government from bombarding legal marijuana businesses. The change in law resulted in swift action from the opposition. According to The Rolling Stone, marijuana advocates kept an amendment in the short-term spending bill that “forbids the department of justice or the drug enforcement administration from using federal funds to go after locally legal medical marijuana shops and growers.”
“but that language still doesn’t extend to the eight states and the District of Columbia that have legalized recreational marijuana,”
The Rolling Stone statement continued. Despite the political tension, the American marijuana industry has staked its claim within the investment landscape and is vastly expanding. This expansion has led to tax revenue increases, job creation, and new hope for marijuana businesses.
Growth in the recreational market is substantial
With the legalization of marijuana in California, the recreational market is expanding quickly. However, the medical market still exceeds it mainly because medical users purchase more frequently compared to those of the recreational market. Whether this factor will continue to impact sales as legalization moves forward is yet to be seen.
As the marijuana market is still being established, nothing can be seen as definitive especially when trends and hype are involved. However, it makes investors and businesses inquisitive as opportunities are abundant.
It is undisputed that the market is growing, but many challenges exist in controlling a legal marijuana industry. Jeff Sessions’ changes to the rules have produced more challenges, such as the banking situation. Many financial institutions are taking a step back from marijuana businesses due to the Federal Governments outlook. This has placed cash flows in a bind, forcing business owners to become more creative with the ways they process transactions.
For a better picture of the landscape, check out this helpful infographic below from businessstudent.com.