\nSource: marijuanamoment.net<\/a><\/p>\n
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\nA congressman introduced a bill on Friday that would create a variety of programs and grants to help people enter the hemp industry and build their businesses. It would also require a federal study into potential alternative uses for the crop as well as challenges faced by the market.<\/p>\n
\nRep. Denver Riggleman (R-VA) filed the Hemp Opportunity Zone Act. As the title implies, the main component of the legislation clarifies that farmers who cultivate the crop can receive tax benefits if they operate in an area designated as an \u201copportunity zone\u201d by the Treasury Department.<\/p>\n
\nOpportunity zones are census-designated low-income areas that are considered economically distressed. The governor of a state can make the designation, and Treasury then decides whether to certify it. The program is designed to promote investments in communities that might typically be overlooked by allowing investors to defer capital gains taxes if they put money into an opportunity zone business.<\/p>\n
\n\u201cWe are reviewing the legislation now, but if it indeed serves to open up investment in hard-hit farming and small business communities, it would be welcome relief for an industry that has been struggling through the COVID pandemic and federal burdens imposed by FDA, USDA and now the DEA,\u201d Jonathan Miller, general counsel for the U.S. Hemp Roundtable, told Marijuana Moment.<\/p>\n
\nIn addition to clarifying eligibility for hemp-focused businesses, Riggleman\u2019s new bill would also create a \u201chemp farmer start-up tax credit\u201d equal to 10 percent of the cash rent paid for land used for production or 15 percent of the \u201ccrop share rent so paid by the taxpayer.\u201d To be eligible, farmers would need to have less than $25 million in gross receipts for the last taxable year.<\/p>\n
\n\nThe Hemp Opportunity Zone Act is a huge win for farmers in\u00a0<\/span>#VA05<\/a>. Hemp farming is a new and thriving industry. By providing these tax incentives hemp growers in Virginia and the 5th District are primed to lead based on their historic production of tobacco.\u00a0<\/span>https:\/\/t.co\/LncEw7SQsS<\/a><\/div>\n<\/blockquote>\n\nThe legislation would further establish a \u201csmall hemp farmer credit\u201d that would enable businesses with less than $250,000 in gross receipts for the previous taxable year to obtain a credit \u201cequal to 30 percent of the basis of hemp farming property placed in service.\u201d<\/p>\n
\n\u201cHemp farming is a new and thriving industry,\u201d Riggleman, who lost his primary renomination bid this year and only has a few months left in Congress, said. \u201cBy providing these tax incentives hemp growers in Virginia and the 5th District are primed to lead based on their historic production of tobacco.\u201d<\/p>\n
\nHe\u00a0<\/span>said<\/span><\/a>\u00a0<\/span>that expanding opportunity zone eligibility to the market \u201cwill incentivize investments into long neglected neighborhoods that will spur economic growth and combat poverty.\u201d<\/div>\n\nFinally, the\u00a0<\/span>bill<\/span><\/a>\u00a0<\/span>also calls on the Treasury Department to work with the U.S. Department of Agriculture (USDA) on a study of the hemp industry.<\/div>\n\nThe report would look at opportunities to use hemp seeds in animal feed, the potential use of hemp products as protective equipment for medical workers and first responders and the \u201cfeasibility\u201d of certain USDA regulations for the market.<\/p>\n
\nCertain questions the study would address concern complaints industry stakeholders have made about USDA\u2019s interim final rule for the crop. Treasury and USDA would have to consider the department\u2019s hemp sampling requirements and its 0.3 THC limit for the crop.<\/p>\n
\nThe agencies would also have to explore how the U.S. competes \u201cglobally with other countries that have a 1.0 percent THC limitation.\u201d The bill states that the study should additionally consider the potential benefits of including hemp-based food items in \u201ccertain public school meal plans\u201d and whether any items used by the federal government or its contractors \u201ccan be substituted by a hemp-based product.\u201d<\/p>\n
\nSenate Minority Leader Chuck Schumer (D-NY) earlier this month wrote to Agriculture Secretary Sonny Perdue, similarly asking that\u00a0<\/span>USDA delay issuing final regulations for the crop<\/span><\/a>\u00a0<\/span>until 2022 and allow states to continue operating under the 2014 Farm Bill hemp pilot program in the meantime.<\/div>\n\nAs USDA works to finalize their regulations, which they intend to complete by October 2021, the department has been systematically approving hemp plans proposed by individual states, territories and tribes. The most recent approvals were for\u00a0Maryland and the Lower Sioux Indian Community<\/span><\/a>.<\/div>\n\nRead the text of the Hemp Opportunity Zone Act at the following link:<\/span><\/strong><\/p>\n