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Tax Reform For Legal Pot Businesses Brings Together An Odd Group

It's not every day you see a Democrat and Grover Norquist saying nice things about each other.

Posted on September 12, 2013, at 12:53 p.m. ET

Kate Nocera/BuzzFeed

Rep. Dana Rohrabacher, Rep. Earl Blumenauer, Americans for Tax Reform President Grover Norquist, and Aaron Smith from the National Cannabis Industry Association.

WASHINGTON — What is one way to get reporters to attend a sweltering outdoor press conference about a wonky provision in the tax code? Make it about weed.

An exceptionally odd group showed up to talk about the unfair tax burdens on pot dispensaries in two dozen states. The issue brought together Grover Norquist of Americans for Tax Reform, a constant boogeyman of the left, and the super-liberal Rep. Earl Blumenauer, who introduced a fix to the provision with conservative Californian Dana Rohrabacher.

"It's goofy, it's goofy. And this is perhaps the most insane because it doesn't allow legal businesses to operate like other businesses," Blumenauer said. "Grover Norquist and the Americans for Tax Reform, with whom I am not often sharing a stage unless it's a comedy performance, have done a superb job. Their policy statement has vivid illustrations about the inequity."

A 1982 piece of the tax code, designed to punish drug traffickers, forces legal marijuana dispensaries in states across the country to pay an effective tax rate of around 87%, whereas most small businesses pay around 35%.

"The organizers of the press conference feared that a press conference dealing with marijuana might not get the attention of the press, so they said could you come and talk about capital cost recovery and ordinary and necessary business deductions in the IRS tax code," Norquist quipped. "I'm glad that brought you all here."

Norquist said that ATR does not have a position on drug prohibition, but said, "the government ought not to be picking winners and losers in the tax code."

Blumenauer and Rohrabacher said the legislation wasn't about whether or not smoking weed should be legal, though both have pushed for more flexible laws when it comes to legalizing marijuana.

"It is absolutely ridiculous to be wasting our federal dollars enforcing laws that local people don't want," Rorhabacher said. "It's an enormous waste of money. Instead what we should be doing is making sure, which is what this legislation does, molding the federal regulations, whether it's taxes or otherwise, to respect the will of the communities in states throughout our country."

While Blumenauer heaped praise on Norquist, and repeatedly pointed to the fact that the legislation was really nonpartisan, Norquist and Rorhabacher couldn't help themselves but to goad the liberal Oregonian a bit.

"Mr. Blumenauer and other Democrats are very pleased that several conservative Republicans have come over in favor of promoting the states and the people that make the decisions at the state level," Rorhabacher said. "I want you to know Republicans are very happy that Mr. Blumenauer has come out for lower taxes."

"Feels good," Blumenauer said.

"It's habit-forming," Norquist added.

  • Picture of Kate Nocera

    Kate Nocera is the DC Bureau Chief for BuzzFeed News. Nocera is a recipient of the National Press Foundation's 2014 Dirksen Award for distinguished reporting on Congress.

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