// Definition
A U.S. Internal Revenue Code provision that prevents businesses trafficking in Schedule I or II controlled substances from deducting normal business expenses. This results in cannabis businesses paying effective tax rates of 70% or more, creating a crippling financial burden on legal operators.
// From the Episode
Episode 18 discussed 280E as a crippling tax to any type of business that's trying to operate legally in cannabis. The panel noted how this federal tax code creates an impossible situation where legal cannabis businesses pay far more in taxes than other industries while still operating in a legal gray area.