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Legal Marijuana Hooks Alcohol Distributors

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Legal Marijuana Hooks Alcohol Distributors

By Thomas Pellechia | Forbes.com

According to the Nevada Independent the vote to legalize marijuana for recreational use in that state certainly grabbed the attention of its alcohol distributors.

Like all fifty states in the U.S., Nevada’s alcohol distribution takes place under the Three Tier system from producer (tier 1), to warehouse/distributor (tier 2), to retailer (tier 3), to consumer. The system was designed in 1933 with Repeal of Prohibition; its ostensible mission was to keep alcohol out of the hands of criminals and prevent the monopolistic tendencies of those producers which, before Prohibition, often had direct bar ownership and direct retail access to consumers.

Repeal also gave states the right to control access to alcohol within their individual borders. Over time, many states have loosened restrictions, but the one thing neither federal nor state government has ceded, and for which the Three Tier system acts as a collection agency, is the alcohol excise tax .

Nevada’s Department of Taxation has proposed regulations for taxing the state’s newest control industry, which is set for a Tax Commission vote on May 8, 2017. But in it, the Independent Alcohol Distributors of Nevada don’t see themselves mentioned. Instead, under the proposed regulation, the state’s marijuana producers would become their own distributors.

Continue reading at Forbes.com

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