April 1, 2022, the New Mexico cannabis rules and regulations are changing, legislation has passed The Cannabis Regulation Act allowing adult-use marijuana. Redbud Advisors can help advise and get you started.
There are many intricacies to the Cannabis Regulation Act, we will outline some specifics here but it is always best to contact us so we can answer your specific questions.
Keep in mind, as these new regulations go into effect there will be medical cannabis provisions.
What is The Cannabis Regulation Act of New Mexico?
The Cannabis Regulation Act of New Mexico legalizes and regulates the use of cannabis for adults 21 and older. When this act goes into effect New Mexicans will be allowed to:
Possess, purchase, and give other adults marijuana products (regulations apply)
Cultivate Their own products including plants, cannabis-infused foods, and extracts (some regulations apply)
Have the option to possess large quantities of cannabis if it is stored properly (regulations apply)
Ability to possess, manufacture, and give away paraphernalia
The Cannabis Control Division will not allow any predatory marketing targeting any other demographic than outlined above, especially the youth of New Mexico. This will be consistent with packaging and the types of avenues allowed to advertise. Redbud Advisors can help you navigate how this will affect your business model and ensure you are operating within compliance.
In New Mexico, even with adult-use cannabis being legalized, there are still penalties in place for smoking cannabis in public, excessive possession as well as underage possession, and DUIs.
How Do I Open a Cannabis Business in New Mexico?
If you are an entrepreneur who is looking to open an adult-use cannabis business in New Mexico you can apply for a license with the Cannabis Control Division. It can take up to 90 days for an application to be completed. Below is a list of the types of businesses that can apply:
Producers
Manufacturers
Retailers
Couriers
Microbusinesses (no more than 200 mature plants at a time)
Cannabis Consumption Areas
Vertically Integrated Establishments
Integrated microbusinesses (streamline operations by having direct ownership in different stages of the production process)
A helpful tip: One business location can have multiple licenses and licensees can operate more than one business.
Licensing fees can range from $1,000 for a producer microbusiness fee to $7,500 for a vertically integrated cannabis establishment adding an additional $1,000 for each licensed premise. The majority of license types are $2,500 per year, plus $1,000 for each licensed premises.
What Do I Need to Know About Taxation?
The Cannabis Regulation Act of New Mexico will have additional rules and regulations surrounding taxes applying to adult-use marijuana. Redbud Advisors is available to aid in understanding this information below and how it applies to your cannabis business.
12% excise tax on all retail sales this tax will increase by 1% every year until maxing out at 18%.
Gross receipts taxes ranging from 5.125% to 8.8125% would apply to adult-use (some regulations apply)
Additional revenue distribution is expected to include funding for community reinvestment (more information on this in the future)
Conclusion
Learning the complexity of the New Mexico Cannabis Rules and Regulations can be overwhelming. Redbud Advisors is available to help this process be as painless as possible. We take the time to get to know our clients understand the direction of their business and align our advice with their goals.
We encourage you to get to know our specialized accounting experts at Redbud Advisors for all of your cannabis accounting and tax needs. At Redbud Advisors it is our mission to help make your dreams a reality and your taxes compliant.
To get answers to your questions and expert advice you can contact Redbud Advisors here or give us a call at 866-830-5144.
