DeutschHello, dear readers! Let’s take a look together at the latest developments in the cannabis sector.
An impressive rise in Q3 Last week’s news that the US may reclassify cannabis from Schedule I to Schedule III has sent global cannabis stocks soaring. According to New Cannabis Ventures’ Global Cannabis Stock Index, which tracks the entire listed market for the medical and legal cannabis sector, global stocks jumped over 20% following the news. This helped the index to rise by 19.1% in the third quarter.
Year-over-year overview Despite this impressive rise, global cannabis stocks are still down 8% for the year and are around 90% below their highs in February 2021.
Tax Considerations Alan Brochstein of New Cannabis Ventures explained that while the news was not entirely surprising given the commitments President Biden made earlier this year, it could mean the elimination of the 280E tax. This “burdensome” taxation has long been seen as a major obstacle for cannabis businesses, as they were required to pay much higher taxes than the normal income tax.
Future considerations However, there are warnings that this is not yet set in stone. The DEA could still decide to move cannabis to Schedule II, and implementation could take a long time. In addition, concerns have been raised that by moving cannabis to a less risky Schedule III, the FDA could increase its regulatory role, which would put current operators at “great risk.”
Closing thoughts The cannabis industry remains a dynamic and ever-changing sector. It will be interesting to see how things develop in the coming months, particularly with regard to regulatory changes and the impact on the stock market.