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by Stockwatch Business Reporter

The S&P/TSX Cannabis Index added a fraction to 32.52, while the CSE Composite Index lost 3.17 to 193.56. South of the border, cannabis circles were abuzz over a bill filed in Congress to provide federal tax relief for cannabis companies. The bill would "allow deductions and credits relating to expenditures with marijuana sales conducted in compliance with state law."

Such a law would come as a great relief to cannabis companies. Under a current section of U.S. tax code known as 280E, cannabis companies (unlike other businesses) cannot deduct most business expenses or receive tax credits, yet are obligated to pay taxes nonetheless. This results in an effective tax rate of anywhere from 60 to 100 per cent of pretax income, compared with the federal statutory rate of 21 per cent. The new bill, filed by Republican Nancy Mace in the House of Representatives, aims to knock down this massive hurdle to profitability in the sector.

There is one glaring problem. Although chatter about Ms. Mace's bill picked up over the weekend and today, the date of the actual filing was Friday, the final weekday in the session of the 117th Congress -- in other words, with no time for the bill to advance. Ms. Mace will need to reintroduce it in the 118th Congress, which began today. She has not said when she might do so. (The timing is even more uncertain in light of the current disarray among House Republicans, who -- for the first time in a century -- failed to elect a speaker on the first vote. After two additional unsuccessful votes, the House adjourned for the day without a speaker, meaning the chamber remains at a standstill and cannot engage in floor proceedings.)

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