One of the most important results of the potential rescheduling of cannabis to Schedule 3 is eliminating 280e taxes. In previous charts of the week, we have shown that 280e significantly negatively impacts cannabis companies by reducing their internally funded growth and limiting their debt capacity.

The chart explores the second-quarter tax rates of thirteen large MSOs and shows an estimate of the annualized tax savings for each company from the elimination of 280e.

In most other industries, it would be common to calculate effective tax rates by dividing tax expense by pretax income. However, effective tax rates are impossible to calculate for most companies on the chart, seven of which have positive tax expenses despite their negative pretax income. Accordingly, the orange line shows tax expense as a revenue percentage, ranging from about 4% to 13%. Note: effective tax rates are calculable for Ascend Wellness (OTC: AAWH), MariMed (OTC: MRMD), Green Thumb (OTC: GTBIF), and Verano (OTC: <a class="ticker" …

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