II 

115TH CONGRESS 

1ST SESSION S. 776 

To amend the Internal Revenue Code of 1986 to provide for the taxation 

and regulation of marijuana products, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MARCH 30, 2017 

Mr. WYDEN introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to provide 

for the taxation and regulation of marijuana products, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Marijuana Revenue and Regulation Act’’. 

6 (b) TABLE OF CONTENTS.—The table of contents of 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—TAXATION 

Sec. 101. Establishment of taxes relating to marijuana products. 

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TITLE II—REGULATION 

Subtitle A—Amendments To Decriminalize Marijuana at the Federal Level 

Sec. 201. Decriminalization of marijuana. 

Sec. 202. Application of the Controlled Substances Act and Controlled Substances Import and Export Act to marijuana. 

Sec. 203. Conforming and ancillary amendments. 

Subtitle B—Federal Marijuana Licensing and Related Matters 

Sec. 211. Federal marijuana administration. 

Sec. 212. Addition of marijuana to certain legal authorities relating to intoxicating liquors. 

Subtitle C—Other Amendments Relating to Federal Authority Regarding 

Marijuana 

Sec. 221. Food and Drug Administration. 

Sec. 222. Transferring agency functions with regard to marijuana. 

Sec. 223. Unfair advertising practices. 

Sec. 224. Comptroller General review of laws and regulations. 

TITLE III—FUNDING 

Sec. 301. Funding for the Alcohol, Tobacco, and Marijuana Tax and Trade Bureau. 

1 TITLE I—TAXATION 

2 SEC. 101. ESTABLISHMENT OF TAXES RELATING TO MARI3 JUANA PRODUCTS. 

4 (a) IN GENERAL.—Subtitle E of title I of the Inter5 nal Revenue Code of 1986 is amended by adding at the 

6 end the following new chapter: 

7 ‘‘CHAPTER 56—MARIJUANA PRODUCTS 

‘‘SUBCHAPTER A. TAX ON MARIJUANA PRODUCTS

‘‘SUBCHAPTER B. OCCUPATIONAL TAX

‘‘SUBCHAPTER C. BOND AND PERMITS

‘‘SUBCHAPTER D. OPERATIONS

‘‘SUBCHAPTER E. PENALTIES

8 ‘‘Subchapter A—Tax on Marijuana Products 

‘‘Sec. 5901. Imposition of tax. 

‘‘Sec. 5902. Definitions. 

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‘‘Sec. 5903. Liability and method of payment. 

‘‘Sec. 5904. Exemption from tax. 

‘‘Sec. 5905. Credit, refund, or drawback of tax. 

1 ‘‘SEC. 5901. IMPOSITION OF TAX. 

2 ‘‘(a) IMPOSITION OF TAX.—There is hereby imposed 

3 on any marijuana product produced in or imported into 

4 the United States a tax equal to— 

5 ‘‘(1) for any such product sold during the first 

6 5 calendar years in which this chapter becomes ef7 fective, the applicable percentage of the price for 

8 which such product is sold, and 

9 ‘‘(2) for any product sold during any calendar 

10 year after the period described in paragraph (1), the 

11 applicable equivalent rate. 

12 ‘‘(b) APPLICABLE PERCENTAGE.—For purposes of 

13 subsection (a)(1), the applicable percentage shall be deter14 mined as follows: 

15 ‘‘(1) For any marijuana product sold during the 

16 first 2 calendar years in which this chapter becomes 

17 effective, 10 percent. 

18 ‘‘(2) For any marijuana product sold during the 

19 calendar year after the period described in para20 graph (1), 15 percent. 

21 ‘‘(3) For any marijuana product sold during the 

22 calendar year after the period described in para23 graph (2), 20 percent. 

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1 ‘‘(4) For any marijuana product sold during the 

2 calendar year after the period described in para3 graph (3), 25 percent. 

4 ‘‘(c) APPLICABLE EQUIVALENT RATE.— 

5 ‘‘(1) IN GENERAL.—For purposes of subsection 

6 (a)(2), the applicable equivalent rate for each cal7 endar year shall be equal to— 

8 ‘‘(A) in the case of any marijuana product 

9 not described in subparagraph (B) which is sold 

10 during such year, the applicable rate per ounce 

11 of such product (and a proportionate tax at the 

12 like rate on all fractional parts of an ounce of 

13 such product), and 

14 ‘‘(B) in the case of any marijuana product 

15 containing a marijuana derivative which is sold 

16 during such year, the applicable rate per gram 

17 of tetrahydrocannabinol in such product (and a 

18 proportionate tax at the like rate on all frac19 tional parts of a gram of tetrahydrocannabinol 

20 in such product). 

21 ‘‘(2) APPLICABLE RATE.— 

22 ‘‘(A) IN GENERAL.—For purposes of para23 graph (1)(A), the applicable rate per ounce for 

24 any calendar year shall be equal to 25 percent 

25 of the prevailing sales price of marijuana sold 

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1 in the United States during the 12-month pe2 riod ending one calendar quarter before such 

3 calendar year, expressed on a per ounce basis, 

4 as determined by the Secretary. 

5 ‘‘(B) MARIJUANA DERIVATIVES.—For pur6 poses of paragraph (1)(B), the applicable rate 

7 per gram of tetrahydrocannabinol shall be equal 

8 to the quotient obtained by dividing— 

9 ‘‘(i) the applicable rate per ounce (as 

10 determined under subparagraph (A)), by 

11 ‘‘(ii) 2.83495. 

12 ‘‘(d) TIME OF ATTACHMENT ON MARIJUANA PROD13 UCTS.—The tax under this section shall attach to any 

14 marijuana product as soon as such product is in existence 

15 as such, whether it be subsequently separated or trans16 ferred into any other substance, either in the process of 

17 original production or by any subsequent process. 

18 ‘‘SEC. 5902. DEFINITIONS. 

19 ‘‘For purposes of this chapter: 

20 ‘‘(1) EXPORT WAREHOUSE.—The term ‘export 

21 warehouse’ means a bonded internal revenue ware22 house for the storage of marijuana products, upon 

23 which the internal revenue tax has not been paid— 

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1 ‘‘(A) for subsequent shipment to a foreign 

2 country, Puerto Rico, the Virgin Islands, or a 

3 possession of the United States, or 

4 ‘‘(B) for consumption beyond the jurisdic5 tion of the internal revenue laws of the United 

6 States. 

7 ‘‘(2) EXPORT WAREHOUSE PROPRIETOR.—The 

8 term ‘export warehouse proprietor’ means any per9 son who operates an export warehouse. 

10 ‘‘(3) IMPORTER.—The term ‘importer’ means 

11 any person who— 

12 ‘‘(A) is in the United States and to whom 

13 nontaxpaid marijuana products, produced in a 

14 foreign country, Puerto Rico, the Virgin Is15 lands, or a possession of the United States, are 

16 shipped or consigned, 

17 ‘‘(B) removes marijuana products for sale 

18 or consumption in the United States from a 

19 customs bonded warehouse, or 

20 ‘‘(C) smuggles or otherwise unlawfully 

21 brings marijuana or marijuana products into 

22 the United States. 

23 ‘‘(4) MARIJUANA.—The term ‘marijuana’ has 

24 the meaning given the term ‘marihuana’ under secmstockstill on DSK3G9T082PROD with BILLS

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1 tion 102(16) of the Controlled Substances Act (21 

2 U.S.C. 802(16)). 

3 ‘‘(5) MARIJUANA DERIVATIVE.—The term 

4 ‘marijuana derivative’ means any article containing 

5 marijuana, or any derivative thereof, which is not a 

6 naturally grown and unadulterated marijuana flow7 er. 

8 ‘‘(6) MARIJUANA ENTERPRISE.—The term 

9 ‘marijuana enterprise’ means a producer, export 

10 warehouse proprietor, or importer. 

11 ‘‘(7) MARIJUANA PRODUCT.— 

12 ‘‘(A) IN GENERAL.—Except as provided in 

13 subparagraph (B), the term ‘marijuana prod14 uct’ means any article which contains mari15 juana or any marijuana derivative. 

16 ‘‘(B) EXCEPTIONS.— 

17 ‘‘(i) IN GENERAL.—The term ‘mari18 juana product’ shall not include— 

19 ‘‘(I) any article containing mari20 juana which has been approved by the 

21 Food and Drug Administration for 

22 sale for therapeutic purposes and is 

23 marketed and sold solely for such pur24 pose, or 

25 ‘‘(II) industrial hemp. 

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1 ‘‘(ii) INDUSTRIAL HEMP.—For pur2 poses of clause (i)(II), the term ‘industrial 

3 hemp’ means the plant Cannabis sativa L. 

4 and any part of such plant, whether grow5 ing or not, with a delta-9 

6 tetrahydrocannabinol concentration of not 

7 more than 0.3 percent on a dry weight 

8 basis. 

9 ‘‘(8) MARIJUANA PRODUCTION FACILITY.—The 

10 term ‘marijuana production facility’ means an estab11 lishment which is qualified under subchapter C to 

12 perform any operation for which such qualification is 

13 required under such subchapter. 

14 ‘‘(9) PRODUCER.—The term ‘producer’ means 

15 any person who— 

16 ‘‘(A) plants, cultivates, harvests, or other17 wise produces marijuana or marijuana prod18 ucts, or 

19 ‘‘(B) manufactures, compounds, converts, 

20 processes, prepares, or packages marijuana 

21 products. 

22 ‘‘(10) REMOVAL; REMOVE.—The terms ‘re23 moval’ or ‘remove’ mean— 

24 ‘‘(A) the removal of marijuana products 

25 from the premises of a producer, or from intermstockstill on DSK3G9T082PROD with BILLS

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1 nal revenue bond under section 5904, as the 

2 Secretary shall by regulation prescribe, 

3 ‘‘(B) release of such products from cus4 toms custody, or 

5 ‘‘(C) smuggling or other unlawful importa6 tion of such products into the United States. 

7 ‘‘(11) RETAILER.—The term ‘retailer’ means a 

8 person who sells marijuana products to consumers. 

9 ‘‘SEC. 5903. LIABILITY AND METHOD OF PAYMENT. 

10 ‘‘(a) LIABILITY FOR TAX.— 

11 ‘‘(1) ORIGINAL LIABILITY.—The producer or 

12 importer of any marijuana product shall be liable for 

13 the taxes imposed thereon by section 5901. 

14 ‘‘(2) TRANSFER OF LIABILITY.— 

15 ‘‘(A) IN GENERAL.—When marijuana 

16 products are transferred, without payment of 

17 tax, pursuant to section 5904, the liability for 

18 tax shall be transferred in accordance with the 

19 provisions of this paragraph. 

20 ‘‘(B) TRANSFER BETWEEN PRODUCER AND

21 EXPORT WAREHOUSE PROPRIETOR.—In the 

22 case of marijuana products which are trans23 ferred between the bonded premises of pro24 ducers and export warehouse proprietors, the 

25 transferee shall become liable for the tax upon 

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1 receipt by the transferee of such articles, and 

2 the transferor shall thereupon be relieved of 

3 their liability for such tax. 

4 ‘‘(C) TRANSFER FROM CUSTOMS CUSTODY

5 TO PRODUCER.—In the case of marijuana prod6 ucts which are released in bond from customs 

7 custody for transfer to the bonded premises of 

8 a producer, the transferee shall become liable 

9 for the tax on such articles upon release from 

10 customs custody, and the importer shall there11 upon be relieved of their liability for such tax. 

12 ‘‘(D) RETURNED TO BOND.—All provisions 

13 of this chapter applicable to marijuana products 

14 in bond shall be applicable to such articles re15 turned to bond upon withdrawal from the mar16 ket or returned to bond after previous removal 

17 for a tax-exempt purpose. 

18 ‘‘(b) METHOD OF PAYMENT OF TAX.— 

19 ‘‘(1) IN GENERAL.— 

20 ‘‘(A) DETERMINATION AND PAYMENT OF

21 TAX.—The taxes imposed by section 5901 shall 

22 be determined at the time of removal of the 

23 marijuana products. Such taxes shall be paid on 

24 the basis of return. The Secretary shall, by reg25 ulations, prescribe the period or the event for 

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1 which such return shall be made and the infor2 mation to be furnished on such return. 

3 ‘‘(B) POSTPONEMENT.—Any postponement 

4 under this subsection of the payment of taxes 

5 determined at the time of removal shall be con6 ditioned upon the filing of such additional 

7 bonds, and upon compliance with such require8 ments, as the Secretary may prescribe for the 

9 protection of the revenue. The Secretary may, 

10 by regulations, require payment of tax on the 

11 basis of a return prior to removal of the mari12 juana products where a person defaults in the 

13 postponed payment of tax on the basis of a re14 turn under this subsection or regulations pre15 scribed thereunder. 

16 ‘‘(C) ADMINISTRATION AND PENALTIES.— 

17 All administrative and penalty provisions of this 

18 title, insofar as applicable, shall apply to any 

19 tax imposed by section 5901. 

20 ‘‘(2) TIME FOR PAYMENT OF TAXES.— 

21 ‘‘(A) IN GENERAL.—Except as otherwise 

22 provided in this paragraph, in the case of taxes 

23 on marijuana products removed during any 

24 semimonthly period under bond for deferred 

25 payment of tax, the last day for payment of 

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1 such taxes shall be the 14th day after the last 

2 day of such semimonthly period. 

3 ‘‘(B) IMPORTED ARTICLES.—In the case of 

4 marijuana products which are imported into the 

5 United States, the following provisions shall 

6 apply: 

7 ‘‘(i) IN GENERAL.—The last day for 

8 payment of tax shall be the 14th day after 

9 the last day of the semimonthly period 

10 during which the article is entered into the 

11 customs territory of the United States. 

12 ‘‘(ii) SPECIAL RULE FOR ENTRY OF

13 WAREHOUSING.—Except as provided in 

14 clause (iv), in the case of an entry for 

15 warehousing, the last day for payment of 

16 tax shall not be later than the 14th day 

17 after the last day of the semimonthly pe18 riod during which the article is removed 

19 from the first such warehouse. 

20 ‘‘(iii) FOREIGN TRADE ZONES.—Ex21 cept as provided in clause (iv) and in regu22 lations prescribed by the Secretary, articles 

23 brought into a foreign trade zone shall, 

24 notwithstanding any other provision of law, 

25 be treated for purposes of this subsection 

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1 as if such zone were a single customs 

2 warehouse. 

3 ‘‘(iv) EXCEPTION FOR ARTICLES DES4 TINED FOR EXPORT.—Clauses (ii) and (iii) 

5 shall not apply to any article which is 

6 shown to the satisfaction of the Secretary 

7 to be destined for export. 

8 ‘‘(C) MARIJUANA PRODUCTS BROUGHT

9 INTO THE UNITED STATES FROM PUERTO

10 RICO.—In the case of marijuana products which 

11 are brought into the United States from Puerto 

12 Rico, the last day for payment of tax shall be 

13 the 14th day after the last day of the semi14 monthly period during which the article is 

15 brought into the United States. 

16 ‘‘(D) SPECIAL RULE WHERE DUE DATE

17 FALLS ON SATURDAY, SUNDAY, OR HOLIDAY.— 

18 Notwithstanding section 7503, if, but for this 

19 subparagraph, the due date under this para20 graph would fall on a Saturday, Sunday, or a 

21 legal holiday (as defined in section 7503), such 

22 due date shall be the immediately preceding day 

23 which is not a Saturday, Sunday, or such a hol24 iday. 

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1 ‘‘(E) SPECIAL RULE FOR UNLAWFULLY

2 PRODUCED MARIJUANA PRODUCTS.—In the 

3 case of any marijuana products produced in the 

4 United States at any place other than the 

5 premises of a producer that has filed the bond 

6 and obtained the permit required under this 

7 chapter, tax shall be due and payable imme8 diately upon production. 

9 ‘‘(3) PAYMENT BY ELECTRONIC FUND TRANS10 FER.—Any person who in any 12-month period, end11 ing December 31, was liable for a gross amount 

12 equal to or exceeding $5,000,000 in taxes imposed 

13 on marijuana products by section 5901 (or section 

14 7652) shall pay such taxes during the succeeding 

15 calendar year by electronic fund transfer (as defined 

16 in section 5061(e)(2)) to a Federal Reserve Bank. 

17 Rules similar to the rules of section 5061(e)(3) shall 

18 apply to the $5,000,000 amount specified in the pre19 ceding sentence. 

20 ‘‘(c) DEFINITION OF PRICE.— 

21 ‘‘(1) CONTAINERS, PACKING AND TRANSPOR22 TATION CHARGES.—In determining, for the purposes 

23 of this chapter, the price for which an article is sold, 

24 there shall be included any charge for coverings and 

25 containers of whatever nature, and any charge incimstockstill on DSK3G9T082PROD with BILLS

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1 dent to placing the article in condition packed ready 

2 for shipment, but there shall be excluded the amount 

3 of tax imposed by this chapter, whether or not stat4 ed as a separate charge. A transportation, delivery, 

5 insurance, installation, or other charge (not required 

6 by the preceding sentence to be included) shall be 

7 excluded from the price only if the amount thereof 

8 is established to the satisfaction of the Secretary in 

9 accordance with regulations. 

10 ‘‘(2) CONSTRUCTIVE SALE PRICE.— 

11 ‘‘(A) IN GENERAL.—If an article is sold di12 rectly to consumers, sold on consignment, or 

13 sold (otherwise than through an arm’s length 

14 transaction) at less than the fair market price, 

15 or if the price for which the article sold cannot 

16 be determined, the tax under section 5901(a) 

17 shall be computed on the price for which such 

18 articles are sold, in the ordinary course of 

19 trade, by producers thereof, as determined by 

20 the Secretary. 

21 ‘‘(B) ARM’S LENGTH.— 

22 ‘‘(i) IN GENERAL.—For purposes of 

23 this section, a sale is considered to be 

24 made under circumstances otherwise than 

25 at arm’s length if— 

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1 ‘‘(I) the parties are members of 

2 the same controlled group, whether or 

3 not such control is actually exercised 

4 to influence the sale price, or 

5 ‘‘(II) the sale is made pursuant 

6 to special arrangements between a 

7 producer and a purchaser. 

8 ‘‘(ii) CONTROLLED GROUPS.— 

9 ‘‘(I) IN GENERAL.—The term 

10 ‘controlled group’ has the meaning 

11 given to such term by subsection (a) 

12 of section 1563, except that ‘more 

13 than 50 percent’ shall be substituted 

14 for ‘at least 80 percent’ each place it 

15 appears in such subsection. 

16 ‘‘(II) CONTROLLED GROUPS

17 WHICH INCLUDE NONINCORPORATED

18 PERSONS.—Under regulations pre19 scribed by the Secretary, principles 

20 similar to the principles of subclause 

21 (I) shall apply to a group of persons 

22 under common control where one or 

23 more of such persons is not a corpora24 tion. 

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1 ‘‘(d) PARTIAL PAYMENTS AND INSTALLMENT AC2 COUNTS.— 

3 ‘‘(1) PARTIAL PAYMENTS.—In the case of— 

4 ‘‘(A) a contract for the sale of an article 

5 wherein it is provided that the price shall be 

6 paid by installments and title to the article sold 

7 does not pass until a future date notwith8 standing partial payment by installments, 

9 ‘‘(B) a conditional sale, or 

10 ‘‘(C) a chattel mortgage arrangement 

11 wherein it is provided that the sales price shall 

12 be paid in installments, 

13 there shall be paid upon each payment with respect 

14 to the article a percentage of such payment equal to 

15 the rate of tax in effect on the date such payment 

16 is due. 

17 ‘‘(2) SALES OF INSTALLMENT ACCOUNTS.—If 

18 installment accounts, with respect to payments on 

19 which tax is being computed as provided in para20 graph (1), are sold or otherwise disposed of, then 

21 paragraph (1) shall not apply with respect to any 

22 subsequent payments on such accounts (other than 

23 subsequent payments on returned accounts with re24 spect to which credit or refund is allowable by rea25 son of section 6416(b)(5)), but instead— 

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1 ‘‘(A) there shall be paid an amount equal 

2 to the difference between— 

3 ‘‘(i) the tax previously paid on the 

4 payments on such installment accounts, 

5 and 

6 ‘‘(ii) the total tax which would be pay7 able if such installment accounts had not 

8 been sold or otherwise disposed of (com9 puted as provided in paragraph (1)), ex10 cept that 

11 ‘‘(B) if any such sale is pursuant to the 

12 order of, or subject to the approval of, a court 

13 of competent jurisdiction in a bankruptcy or in14 solvency proceeding, the amount computed 

15 under subparagraph (A) shall not exceed the 

16 sum of the amounts computed by multiplying— 

17 ‘‘(i) the proportionate share of the 

18 amount for which such accounts are sold 

19 which is allocable to each unpaid install20 ment payment, by 

21 ‘‘(ii) the rate of tax under this chap22 ter in effect on the date such unpaid in23 stallment payment is or was due. 

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1 The sum of the amounts payable under this 

2 subsection in respect of the sale of any article 

3 shall not exceed the total tax. 

4 ‘‘SEC. 5904. EXEMPTION FROM TAX. 

5 ‘‘(a) IN GENERAL.—Marijuana products on which 

6 the internal revenue tax has not been paid or determined 

7 may, subject to such regulations as the Secretary shall 

8 prescribe, be withdrawn from the bonded premises of any 

9 producer in approved containers free of tax and not for 

10 resale for use— 

11 ‘‘(1) exclusively in scientific research by a lab12 oratory, 

13 ‘‘(2) by a proprietor of a marijuana production 

14 facility in research, development, or testing (other 

15 than consumer testing or other market analysis) of 

16 processes, systems, materials, or equipment, relating 

17 to marijuana or marijuana operations, under such 

18 limitations and conditions as to quantities, use, and 

19 accountability as the Secretary may by regulations 

20 require for the protection of the revenue, or 

21 ‘‘(3) by the United States or any governmental 

22 agency thereof, any State, any political subdivision 

23 of a State, or the District of Columbia, for non24 consumption purposes. 

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1 ‘‘(b) MARIJUANA PRODUCTS TRANSFERRED OR RE2 MOVED IN BOND FROM DOMESTIC FACTORIES AND EX3 PORT WAREHOUSES.— 

4 ‘‘(1) IN GENERAL.—Subject to such regulations 

5 and under such bonds as the Secretary shall pre6 scribe, a producer or export warehouse proprietor 

7 may transfer marijuana products, without payment 

8 of tax, to the bonded premises of another producer 

9 or export warehouse proprietor, or remove such arti10 cles, without payment of tax, for shipment to a for11 eign country, Puerto Rico, the Virgin Islands, or a 

12 possession of the United States, or for consumption 

13 beyond the jurisdiction of the internal revenue laws 

14 of the United States. 

15 ‘‘(2) LABELING.—Marijuana products may not 

16 be transferred or removed under this subsection un17 less such products bear such marks, labels, or no18 tices as the Secretary shall by regulations prescribe. 

19 ‘‘(c) MARIJUANA PRODUCTS RELEASED IN BOND

20 FROM CUSTOMS CUSTODY.—Marijuana products im21 ported or brought into the United States may be released 

22 from customs custody, without payment of tax, for deliv23 ery to a producer or export warehouse proprietor if such 

24 articles are not put up in packages, in accordance with 

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1 such regulations and under such bond as the Secretary 

2 shall prescribe. 

3 ‘‘(d) MARIJUANA PRODUCTS EXPORTED AND RE4 TURNED.—Marijuana products classifiable under item 

5 9801.00.10 of the Harmonized Tariff Schedule of the 

6 United States (relating to duty on certain articles pre7 viously exported and returned), as in effect on the date 

8 of the enactment of the Marijuana Revenue and Regula9 tion Act, may be released from customs custody, without 

10 payment of that part of the duty attributable to the inter11 nal revenue tax for delivery to the original producer of 

12 such marijuana products or to the export warehouse pro13 prietor authorized by such producer to receive such prod14 ucts, in accordance with such regulations and under such 

15 bond as the Secretary shall prescribe. Upon such release 

16 such products shall be subject to this chapter as if they 

17 had not been exported or otherwise removed from internal 

18 revenue bond. 

19 ‘‘SEC. 5905. CREDIT, REFUND, OR DRAWBACK OF TAX. 

20 ‘‘(a) CREDIT OR REFUND.— 

21 ‘‘(1) IN GENERAL.—Credit or refund of any tax 

22 imposed by this chapter or section 7652 shall be al23 lowed or made (without interest) to the producer, 

24 importer, or export warehouse proprietor on proof 

25 satisfactory to the Secretary that the claimant promstockstill on DSK3G9T082PROD with BILLS

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1 ducer, importer, or export warehouse proprietor has 

2 paid the tax on— 

3 ‘‘(A) marijuana products withdrawn from 

4 the market by the claimant, or 

5 ‘‘(B) such products lost (otherwise than by 

6 theft) or destroyed, by fire, casualty, or act of 

7 God, while in the possession or ownership of the 

8 claimant. 

9 ‘‘(2) MARIJUANA PRODUCTS LOST OR DE10 STROYED IN BOND.— 

11 ‘‘(A) EXTENT OF LOSS ALLOWANCE.—No 

12 tax shall be collected in respect of marijuana 

13 products lost or destroyed while in bond, except 

14 that such tax shall be collected— 

15 ‘‘(i) in the case of loss by theft, unless 

16 the Secretary finds that the theft occurred 

17 without connivance, collusion, fraud, or 

18 negligence on the part of the proprietor of 

19 marijuana production facility, owner, con20 signor, consignee, bailee, or carrier, or 

21 their employees or agents, 

22 ‘‘(ii) in the case of voluntary destruc23 tion, unless such destruction is carried out 

24 as provided in paragraph (3), and 

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1 ‘‘(iii) in the case of an unexplained 

2 shortage of marijuana products. 

3 ‘‘(B) PROOF OF LOSS.—In any case in 

4 which marijuana products are lost or destroyed, 

5 whether by theft or otherwise, the Secretary 

6 may require the proprietor of a marijuana pro7 duction facility or other person liable for the 

8 tax to file a claim for relief from the tax and 

9 submit proof as to the cause of such loss. In 

10 every case where it appears that the loss was by 

11 theft, the burden shall be upon the proprietor 

12 of the marijuana production facility or other 

13 person responsible for the tax under section 

14 5901 to establish to the satisfaction of the Sec15 retary that such loss did not occur as the result 

16 of connivance, collusion, fraud, or negligence on 

17 the part of the proprietor of the marijuana pro18 duction facility, owner, consignor, consignee, 

19 bailee, or carrier, or their employees or agents. 

20 ‘‘(C) REFUND OF TAX.—In any case where 

21 the tax would not be collectible by virtue of sub22 paragraph (A), but such tax has been paid, the 

23 Secretary shall refund such tax. 

24 ‘‘(D) LIMITATIONS.—Except as provided in 

25 subparagraph (E), no tax shall be abated, remstockstill on DSK3G9T082PROD with BILLS

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1 mitted, credited, or refunded under this para2 graph where the loss occurred after the tax was 

3 determined. The abatement, remission, credit, 

4 or refund of taxes provided for by subpara5 graphs (A) and (C) in the case of loss of mari6 juana products by theft shall only be allowed to 

7 the extent that the claimant is not indemnified 

8 against or recompensed in respect of the tax for 

9 such loss. 

10 ‘‘(E) APPLICABILITY.—The provisions of 

11 this paragraph shall extend to and apply in re12 spect of marijuana products lost after the tax 

13 was determined and before completion of the 

14 physical removal of the marijuana products 

15 from the bonded premises. 

16 ‘‘(3) VOLUNTARY DESTRUCTION.—The propri17 etor of a marijuana production facility or other per18 sons liable for the tax imposed by this chapter or by 

19 section 7652 with respect to any marijuana product 

20 in bond may voluntarily destroy such products, but 

21 only if such destruction is under such supervision 

22 and under such regulations as the Secretary may 

23 prescribe. 

24 ‘‘(4) LIMITATION.—Any claim for credit or re25 fund of tax under this subsection shall be filed withmstockstill on DSK3G9T082PROD with BILLS

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1 in 6 months after the date of the withdrawal from 

2 the market, loss, or destruction of the products to 

3 which the claim relates, and shall be in such form 

4 and contain such information as the Secretary shall 

5 by regulations prescribe. 

6 ‘‘(b) DRAWBACK OF TAX.—There shall be an allow7 ance of drawback of tax paid on marijuana products, when 

8 shipped from the United States, in accordance with such 

9 regulations and upon the filing of such bond as the Sec10 retary shall prescribe. 

11 ‘‘Subchapter B—Occupational Tax 

‘‘Sec. 5911. Imposition and rate of tax. 

‘‘Sec. 5912. Payment of tax. 

‘‘Sec. 5913. Provisions relating to liability for occupational taxes. 

‘‘Sec. 5914. Application to State laws. 

12 ‘‘SEC. 5911. IMPOSITION AND RATE OF TAX. 

13 ‘‘(a) IN GENERAL.—Any person engaged in business 

14 as a producer or an export warehouse proprietor shall pay 

15 a tax of $1,000 per year (referred to in this subchapter 

16 as an ‘occupational tax’) in respect of each premises at 

17 which such business is carried on. 

18 ‘‘(b) PENALTY FOR FAILURE TO REGISTER.—Any 

19 person engaged in business as a producer or an export 

20 warehouse proprietor who willfully fails to pay the occupa21 tion tax shall be fined not more than $5,000, or impris22 oned not more than 2 years, or both, for each such offense. 

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1 ‘‘SEC. 5912. PAYMENT OF TAX. 

2 ‘‘(a) CONDITION PRECEDENT TO CARRYING ON

3 BUSINESS.—No person shall be engaged in or carry on 

4 any trade or business subject to the occupational tax until 

5 such person has paid such tax. 

6 ‘‘(b) COMPUTATION.— 

7 ‘‘(1) IN GENERAL.—The occupational tax shall 

8 be imposed— 

9 ‘‘(A) as of on the first day of July in each 

10 year, or 

11 ‘‘(B) on commencing any trade or business 

12 on which such tax is imposed. 

13 ‘‘(2) PERIOD.—In the case of a tax imposed 

14 under subparagraph (A) of paragraph (1), the occu15 pational tax shall be reckoned for 1 year, and in the 

16 case of subparagraph (B) of such paragraph, it shall 

17 be reckoned proportionately, from the first day of 

18 the month in which the liability to such tax com19 menced, to and including the 30th day of June fol20 lowing. 

21 ‘‘(c) METHOD OF PAYMENT.— 

22 ‘‘(1) PAYMENT BY RETURN.—The occupational 

23 tax shall be paid on the basis of a return under such 

24 regulations as the Secretary shall prescribe. 

25 ‘‘(2) STAMP DENOTING PAYMENT OF TAX.— 

26 After receiving a properly executed return and remstockstill on DSK3G9T082PROD with BILLS

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1 mittance of any occupational tax, the Secretary shall 

2 issue to the taxpayer an appropriate stamp as a re3 ceipt denoting payment of the tax. This paragraph 

4 shall not apply in the case of a return covering li5 ability for a past period. 

6 ‘‘SEC. 5913. PROVISIONS RELATING TO LIABILITY FOR OC7 CUPATIONAL TAXES. 

8 ‘‘(a) PARTNERS.—Any number of persons doing busi9 ness in partnership at any one place shall be required to 

10 pay a single occupational tax. 

11 ‘‘(b) DIFFERENT BUSINESSES OF SAME OWNERSHIP

12 AND LOCATION.—Whenever more than one of the pursuits 

13 or occupations described in this subchapter are carried on 

14 in the same place by the same person at the same time, 

15 except as otherwise provided in this subchapter, the occu16 pational tax shall be paid for each according to the rates 

17 severally prescribed. 

18 ‘‘(c) BUSINESSES IN MORE THAN ONE LOCATION.— 

19 ‘‘(1) LIABILITY FOR TAX.—The payment of the 

20 occupational tax shall not exempt from an additional 

21 occupational tax the person carrying on a trade or 

22 business in any other place than that stated in the 

23 register kept in the office of the official in charge of 

24 the internal revenue district. 

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1 ‘‘(2) STORAGE.—Nothing contained in para2 graph (1) shall require imposition of an occupational 

3 tax for the storage of marijuana products at a loca4 tion other than the place where such products are 

5 sold or offered for sale. 

6 ‘‘(3) PLACE.— 

7 ‘‘(A) IN GENERAL.—For purposes of this 

8 section, the term ‘place’ means the entire office, 

9 plant or area of the business in any one loca10 tion under the same proprietorship. 

11 ‘‘(B) DIVISIONS.—For purposes of this 

12 paragraph, any passageways, streets, highways, 

13 rail crossings, waterways, or partitions dividing 

14 the premises shall not be deemed sufficient sep15 aration to require an additional occupational 

16 tax, if the various divisions are otherwise con17 tiguous. 

18 ‘‘(d) DEATH OR CHANGE OF LOCATION.— 

19 ‘‘(1) IN GENERAL.—In addition to the person 

20 who has paid the occupational tax for the carrying 

21 on of any business at any place, any person de22 scribed in paragraph (2) may secure the right to 

23 carry on, without incurring any additional occupa24 tional tax, the same business at the same place for 

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1 the remainder of the taxable period for which the oc2 cupational tax was paid. 

3 ‘‘(2) ELIGIBLE PERSONS.—The persons de4 scribed in this paragraph are the following: 

5 ‘‘(A) The surviving spouse or child, or ex6 ecutor or administrator or other legal represent7 ative, of a deceased taxpayer. 

8 ‘‘(B) A husband or wife succeeding to the 

9 business of his or her living spouse. 

10 ‘‘(C) A receiver or trustee in bankruptcy, 

11 or an assignee for benefit of creditors. 

12 ‘‘(D) The partner or partners remaining 

13 after death or withdrawal of a member of a 

14 partnership. 

15 ‘‘(3) CHANGE OF LOCATION.—When any person 

16 moves to any place other than the place for which 

17 occupational tax was paid for the carrying on of any 

18 business, such person may secure the right to carry 

19 on, without incurring additional occupational tax, 

20 the same business at the new location for the re21 mainder of the taxable period for which the occupa22 tional tax was paid. To secure the right to carry on 

23 the business without incurring additional occupa24 tional tax, the successor, or the person relocating 

25 their business, must register the succession or relomstockstill on DSK3G9T082PROD with BILLS

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1 cation with the Secretary in accordance with regula2 tions prescribed by the Secretary. 

3 ‘‘(e) FEDERAL AGENCIES OR INSTRUMENTAL4 ITIES.—Any tax imposed by this subchapter shall apply 

5 to any agency or instrumentality of the United States un6 less such agency or instrumentality is granted by statute 

7 a specific exemption from such tax. 

8 ‘‘SEC. 5914. APPLICATION TO STATE LAWS. 

9 ‘‘The payment of any tax imposed by this subchapter 

10 for carrying on any trade or business shall not be held 

11 to— 

12 ‘‘(1) exempt any person from any penalty or 

13 punishment provided by the laws of any State for 

14 carrying on such trade or business within such 

15 State, or in any manner to authorize the commence16 ment or continuance of such trade or business con17 trary to the laws of such State or in places prohib18 ited by municipal law, or 

19 ‘‘(2) prohibit any State from placing a duty or 

20 tax on the same trade or business, for State or other 

21 purposes. 

22 ‘‘Subchapter C—Bond and Permits 

‘‘Sec. 5921. Establishment and bond. 

‘‘Sec. 5922. Application for permit. 

‘‘Sec. 5923. Permit. 

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1 ‘‘SEC. 5921. ESTABLISHMENT AND BOND. 

2 ‘‘(a) PROHIBITION ON PRODUCTION OUTSIDE OF

3 BONDED MARIJUANA PRODUCTION FACILITY.— 

4 ‘‘(1) IN GENERAL.—Except as authorized by 

5 the Secretary or on the bonded premises of a mari6 juana production facility duly authorized to produce 

7 marijuana products according to law— 

8 ‘‘(A) no marijuana may be planted, cul9 tivated, harvested, or grown in any building or 

10 on any premises, and 

11 ‘‘(B) no marijuana product may be manu12 factured, compounded, converted, processed, 

13 prepared, or packaged in any building or on 

14 any premises. 

15 ‘‘(2) AUTHORIZED PRODUCERS ONLY.—No per16 son other than a producer which has filed the bond 

17 required under subsection (b) and received a permit 

18 described in section 5923 may produce any mari19 juana product. 

20 ‘‘(b) BOND.— 

21 ‘‘(1) WHEN REQUIRED.—Every person, before 

22 commencing business as a producer or an export 

23 warehouse proprietor, shall file such bond, condi24 tioned upon compliance with this chapter and regu25 lations issued thereunder, in such form, amount, and 

26 manner as the Secretary shall by regulation premstockstill on DSK3G9T082PROD with BILLS

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1 scribe. A new or additional bond may be required 

2 whenever the Secretary considers such action nec3 essary for the protection of the revenue. 

4 ‘‘(2) APPROVAL OR DISAPPROVAL.—No person 

5 shall engage in such business until he receives notice 

6 of approval of such bond. A bond may be dis7 approved, upon notice to the principal on the bond, 

8 if the Secretary determines that the bond is not ade9 quate to protect the revenue. 

10 ‘‘(3) CANCELLATION.—Any bond filed here11 under may be canceled, upon notice to the principal 

12 on the bond, whenever the Secretary determines that 

13 the bond no longer adequately protects the revenue. 

14 ‘‘SEC. 5922. APPLICATION FOR PERMIT. 

15 ‘‘(a) IN GENERAL.—Every person, before com16 mencing business as a marijuana enterprise, and at such 

17 other time as the Secretary shall by regulation prescribe, 

18 shall make application for the permit provided for in sec19 tion 5923. The application shall be in such form as the 

20 Secretary shall prescribe and shall set forth, truthfully and 

21 accurately, the information called for on the form. Such 

22 application may be rejected and the permit denied if the 

23 Secretary, after notice and opportunity for hearing, finds 

24 that— 

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1 ‘‘(1) the premises on which it is proposed to 

2 conduct the marijuana enterprise are not adequate 

3 to protect the revenue, 

4 ‘‘(2) the activity proposed to be carried out at 

5 such premises does not meet such minimum capacity 

6 or activity requirements as the Secretary may pre7 scribe, or 

8 ‘‘(3) such person (including, in the case of a 

9 corporation, any officer, director, or principal stock10 holder and, in the case of a partnership, a part11 ner)— 

12 ‘‘(A) is, by reason of their business experi13 ence, financial standing, or trade connections or 

14 by reason of previous or current legal pro15 ceedings involving a felony violation of any 

16 other provision of Federal criminal law relating 

17 to marijuana or marijuana products, not likely 

18 to maintain operations in compliance with this 

19 chapter, 

20 ‘‘(B) has been convicted of a felony viola21 tion of any provision of Federal or State crimi22 nal law relating to marijuana or marijuana 

23 products, or 

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1 ‘‘(C) has failed to disclose any material in2 formation required or made any material false 

3 statement in the application therefor. 

4 ‘‘SEC. 5923. PERMIT. 

5 ‘‘(a) ISSUANCE.—A person shall not engage in busi6 ness as a marijuana enterprise without a permit to engage 

7 in such business. Such permit, conditioned upon compli8 ance with this chapter and regulations issued thereunder, 

9 shall be issued in such form and in such manner as the 

10 Secretary shall by regulation prescribe. A new permit may 

11 be required at such other time as the Secretary shall by 

12 regulation prescribe. 

13 ‘‘(b) SUSPENSION OR REVOCATION.— 

14 ‘‘(1) SHOW CAUSE HEARING.—If the Secretary 

15 has reason to believe that any person holding a per16 mit— 

17 ‘‘(A) has not in good faith complied with 

18 this chapter, or with any other provision of this 

19 title involving intent to defraud, 

20 ‘‘(B) has violated the conditions of such 

21 permit, 

22 ‘‘(C) has failed to disclose any material in23 formation required or made any material false 

24 statement in the application for such permit, 

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1 ‘‘(D) has failed to maintain their premises 

2 in such manner as to protect the revenue, 

3 ‘‘(E) is, by reason of previous or current 

4 legal proceedings involving a felony violation of 

5 any other provision of Federal criminal law re6 lating to marijuana, not likely to maintain oper7 ations in compliance with this chapter, or 

8 ‘‘(F) has been convicted of a felony viola9 tion of any provision of Federal or State crimi10 nal law relating to marijuana or marijuana 

11 products, 

12 the Secretary shall issue an order, stating the facts 

13 charged, citing such person to show cause why their 

14 permit should not be suspended or revoked. 

15 ‘‘(2) ACTION FOLLOWING HEARING.—If, after 

16 hearing, the Secretary finds that such person has 

17 not shown cause why their permit should not be sus18 pended or revoked, such permit shall be suspended 

19 for such period as the Secretary deems proper or 

20 shall be revoked. 

21 ‘‘(c) INFORMATION REPORTING.—The Secretary may 

22 require— 

23 ‘‘(1) information reporting by any person issued 

24 a permit under this section, and 

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1 ‘‘(2) information reporting by such other per2 sons as the Secretary deems necessary to carry out 

3 this chapter. 

4 ‘‘(d) INSPECTION OR DISCLOSURE OF INFORMA5 TION.—For rules relating to inspection and disclosure of 

6 returns and return information, see section 6103(o). 

7 ‘‘Subchapter D—Operations 

‘‘Sec. 5931. Inventories, reports, and records. 

‘‘Sec. 5932. Packaging and labeling. 

‘‘Sec. 5933. Purchase, receipt, possession, or sale of marijuana products after 

removal. 

‘‘Sec. 5934. Restrictions relating to marks, labels, notices, and packages. 

‘‘Sec. 5935. Restriction on importation of previously exported marijuana products. 

8 ‘‘SEC. 5931. INVENTORIES, REPORTS, AND RECORDS. 

9 ‘‘Every producer, importer, and export warehouse 

10 proprietor shall— 

11 ‘‘(1) make a true and accurate inventory at the 

12 time of commencing business, at the time of con13 cluding business, and at such other times, in such 

14 manner and form, and to include such items, as the 

15 Secretary shall by regulation prescribe, with such in16 ventories to be subject to verification by any internal 

17 revenue officer, 

18 ‘‘(2) make reports containing such information, 

19 in such form, at such times, and for such periods as 

20 the Secretary shall by regulation prescribe, and 

21 ‘‘(3) keep such records in such manner as the 

22 Secretary shall by regulation prescribe, with such 

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1 records to be available for inspection by any internal 

2 revenue officer during business hours. 

3 ‘‘SEC. 5932. PACKAGING AND LABELING. 

4 ‘‘(a) PACKAGES.—All marijuana products shall, be5 fore removal, be put up in such packages as the Secretary 

6 shall by regulation prescribe. 

7 ‘‘(b) MARKS, LABELS, AND NOTICES.—Every pack8 age of marijuana products shall, before removal, bear the 

9 marks, labels, and notices if any, that the Secretary by 

10 regulation prescribes. 

11 ‘‘(c) LOTTERY FEATURES.—No certificate, coupon, 

12 or other device purporting to be or to represent a ticket, 

13 chance, share, or an interest in, or dependent on, the event 

14 of a lottery shall be contained in, attached to, or stamped, 

15 marked, written, or printed on any package of marijuana 

16 products. 

17 ‘‘(d) INDECENT OR IMMORAL MATERIAL PROHIB18 ITED.—No indecent or immoral picture, print, or rep19 resentation shall be contained in, attached to, or stamped, 

20 marked, written, or printed on any package of marijuana 

21 products. 

22 ‘‘(e) EXCEPTIONS.—Subject to regulations prescribed 

23 by the Secretary, marijuana products may be exempted 

24 from subsections (a) and (b) if such products are— 

25 ‘‘(1) for experimental purposes, or 

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1 ‘‘(2) transferred to the bonded premises of an2 other producer or export warehouse proprietor or re3 leased in bond from customs custody for delivery to 

4 a producer. 

5 ‘‘SEC. 5933. PURCHASE, RECEIPT, POSSESSION, OR SALE OF 

6 MARIJUANA PRODUCTS AFTER REMOVAL. 

7 ‘‘(a) RESTRICTION.—No person shall— 

8 ‘‘(1) with intent to defraud the United States, 

9 purchase, receive, possess, offer for sale, or sell or 

10 otherwise dispose of, after removal, any marijuana 

11 products— 

12 ‘‘(A) upon which the tax has not been paid 

13 or determined in the manner and at the time 

14 prescribed by this chapter or regulations there15 under, or 

16 ‘‘(B) which, after removal without payment 

17 of tax pursuant to section 5904, have been di18 verted from the applicable purpose or use speci19 fied in that section, 

20 ‘‘(2) with intent to defraud the United States, 

21 purchase, receive, possess, offer for sale, or sell or 

22 otherwise dispose of, after removal, any marijuana 

23 products which are not put up in packages as re24 quired under section 5932 or which are put up in 

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1 packages not bearing the marks, labels, and notices, 

2 as required under such section, or 

3 ‘‘(3) otherwise than with intent to defraud the 

4 United States, purchase, receive, possess, offer for 

5 sale, or sell or otherwise dispose of, after removal, 

6 any marijuana products which are not put up in 

7 packages as required under section 5932 or which 

8 are put up in packages not bearing the marks, la9 bels, and notices, as required under such section. 

10 ‘‘(b) EXCEPTION.—Paragraph (3) of subsection (a) 

11 shall not prevent the sale or delivery of marijuana prod12 ucts directly to consumers from proper packages, nor 

13 apply to such articles when so sold or delivered. 

14 ‘‘(c) LIABILITY TO TAX.—Any person who possesses 

15 marijuana products in violation of paragraph (1) or (2) 

16 of subsection (a) shall be liable for a tax equal to the tax 

17 on such articles. 

18 ‘‘SEC. 5934. RESTRICTIONS RELATING TO MARKS, LABELS, 

19 NOTICES, AND PACKAGES. 

20 ‘‘No person shall, with intent to defraud the United 

21 States, destroy, obliterate, or detach any mark, label, or 

22 notice prescribed or authorized, by this chapter or regula23 tions thereunder, to appear on, or be affixed to, any pack24 age of marijuana products before such package is emptied. 

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1 ‘‘SEC. 5935. RESTRICTION ON IMPORTATION OF PRE2 VIOUSLY EXPORTED MARIJUANA PRODUCTS. 

3 ‘‘(a) EXPORT LABELED MARIJUANA PRODUCTS.— 

4 ‘‘(1) IN GENERAL.—Marijuana products pro5 duced in the United States and labeled for expor6 tation under this chapter— 

7 ‘‘(A) may be transferred to or removed 

8 from the premises of a producer or an export 

9 warehouse proprietor only if such articles are 

10 being transferred or removed without tax in ac11 cordance with section 5904, 

12 ‘‘(B) may be imported or brought into the 

13 United States, after their exportation, only if 

14 such articles either are eligible to be released 

15 from customs custody with the partial duty ex16 emption provided in section 5904(d) or are re17 turned to the original producer of such article 

18 as provided in section 5904(c), and 

19 ‘‘(C) may not be sold or held for sale for 

20 domestic consumption in the United States un21 less such articles are removed from their export 

22 packaging and repackaged by the original pro23 ducer into new packaging that does not contain 

24 an export label. 

25 ‘‘(2) ALTERATIONS BY PERSONS OTHER THAN

26 ORIGINAL PRODUCER.—This section shall apply to 

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1 articles labeled for export even if the packaging or 

2 the appearance of such packaging to the consumer 

3 of such articles has been modified or altered by a 

4 person other than the original producer so as to re5 move or conceal or attempt to remove or conceal (in6 cluding by the placement of a sticker over) any ex7 port label. 

8 ‘‘(3) EXPORTS INCLUDE SHIPMENTS TO PUER9 TO RICO.—For purposes of this section, section 

10 5904(d), section 5941, and such other provisions as 

11 the Secretary may specify by regulations, references 

12 to exportation shall be treated as including a ref13 erence to shipment to the Commonwealth of Puerto 

14 Rico. 

15 ‘‘(b) EXPORT LABEL.—For purposes of this section, 

16 an article is labeled for export or contains an export label 

17 if it bears the mark, label, or notice required under section 

18 5904(b). 

19 ‘‘Subchapter E—Penalties 

‘‘Sec. 5941. Civil penalties. 

‘‘Sec. 5942. Criminal penalties. 

20 ‘‘SEC. 5941. CIVIL PENALTIES. 

21 ‘‘(a) OMITTING THINGS REQUIRED OR DOING

22 THINGS FORBIDDEN.—Whoever willfully omits, neglects, 

23 or refuses to comply with any duty imposed upon them 

24 by this chapter, or to do, or cause to be done, any of the 

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1 things required by this chapter, or does anything prohib2 ited by this chapter, shall in addition to any other penalty 

3 provided in this title, be liable to a penalty of $10,000, 

4 to be recovered, with costs of suit, in a civil action, except 

5 where a penalty under subsection (b) or (c) or under sec6 tion 6651 or 6653 or part II of subchapter A of chapter 

7 68 may be collected from such person by assessment. 

8 ‘‘(b) FAILURE TO PAY TAX.—Whoever fails to pay 

9 any tax imposed by this chapter at the time prescribed 

10 by law or regulations, shall, in addition to any other pen11 alty provided in this title, be liable to a penalty of 10 per12 cent of the tax due but unpaid. 

13 ‘‘(c) SALE OF MARIJUANA OR MARIJUANA PRODUCTS

14 FOR EXPORT.— 

15 ‘‘(1) Every person who sells, relands, or receives 

16 within the jurisdiction of the United States any 

17 marijuana products which have been labeled or 

18 shipped for exportation under this chapter, 

19 ‘‘(2) every person who sells or receives such re20 landed marijuana products, and 

21 ‘‘(3) every person who aids or abets in such 

22 selling, relanding, or receiving, 

23 shall, in addition to the tax and any other penalty provided 

24 in this title, be liable for a penalty equal to the greater 

25 of $10,000 or 10 times the amount of the tax imposed 

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1 by this chapter. All marijuana products relanded within 

2 the jurisdiction of the United States shall be forfeited to 

3 the United States and destroyed. All vessels, vehicles, and 

4 aircraft used in such relanding or in removing such mari5 juana products from the place where relanded, shall be 

6 forfeited to the United States. 

7 ‘‘(d) APPLICABILITY OF SECTION 6665.—The pen8 alties imposed by subsections (b) and (c) shall be assessed, 

9 collected, and paid in the same manner as taxes, as pro10 vided in section 6665(a). 

11 ‘‘(e) CROSS REFERENCES.—For penalty for failure to 

12 make deposits or for overstatement of deposits, see section 

13 6656. 

14 ‘‘SEC. 5942. CRIMINAL PENALTIES. 

15 ‘‘(a) FRAUDULENT OFFENSES.—Whoever, with in16 tent to defraud the United States— 

17 ‘‘(1) engages in business as a marijuana enter18 prise without filing the application and obtaining the 

19 permit where required by this chapter or regulations 

20 thereunder, 

21 ‘‘(2) fails to keep or make any record, return, 

22 report, or inventory, or keeps or makes any false or 

23 fraudulent record, return, report, or inventory, re24 quired by this chapter or regulations thereunder, 

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1 ‘‘(3) refuses to pay any tax imposed by this 

2 chapter, or attempts in any manner to evade or de3 feat the tax or the payment thereof, 

4 ‘‘(4) sells or otherwise transfers, contrary to 

5 this chapter or regulations thereunder, any mari6 juana products subject to tax under this chapter, or 

7 ‘‘(5) with intent to defraud the United States, 

8 purchases, receives, possesses, offers for sale, or sells 

9 or otherwise disposes of, any marijuana product— 

10 ‘‘(A) upon which the tax has not been paid 

11 or determined in the manner and at the time 

12 prescribed by this chapter or regulations there13 under, or 

14 ‘‘(B) which, without payment of tax pursu15 ant to section 5904, have been diverted from 

16 the applicable purpose or use specified in that 

17 section, 

18 shall, for each such offense, be fined not more than 

19 $10,000, or imprisoned not more than 5 years, or both. 

20 ‘‘(b) OFFENSES RELATING TO RETAIL TRANS21 ACTIONS.—Any retailer who sells, in any single trans22 action, more than 1 ounce of any marijuana product (or 

23 in the case of any marijuana product containing a mari24 juana derivative, an equivalent amount, as established by 

25 the Secretary) shall be, upon conviction, fined not more 

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1 than $10,000, or imprisoned for not more than 5 years, 

2 or both. 

3 ‘‘(c) OTHER OFFENSES.—Whoever, otherwise than 

4 as provided in subsections (a) and (b) and section 

5 5911(b), violates any provision of this chapter, or of regu6 lations prescribed thereunder, shall, for each such offense, 

7 be fined not more than $1,000, or imprisoned not more 

8 than 1 year, or both. 

9 ‘‘(d) LIABILITY TO TAX.—Any person who possesses 

10 marijuana products in violation of subsection (a) shall be 

11 liable for a tax equal to the tax on such articles.’’. 

12 (b) STUDY.—Not later than 2 years after the date 

13 of the enactment of this Act, and every 5 years thereafter, 

14 the Secretary of the Treasury, or the Secretary’s delegate, 

15 shall— 

16 (1) conduct a study concerning the characteris17 tics of the marijuana industry, including the number 

18 of persons operating marijuana enterprises at each 

19 level of such industry, the volume of sales, the 

20 amount of tax collected each year, and the areas of 

21 evasion, and 

22 (2) submit to Congress recommendations to im23 prove the regulation of the industry and the admin24 istration of the related tax. 

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1 (c) CONFORMING AMENDMENT.—Section 

2 6103(o)(1)(A) of the Internal Revenue Code of 1986 is 

3 amended by striking ‘‘and firearms’’ and inserting ‘‘fire4 arms, and marijuana’’. 

5 (d) CLERICAL AMENDMENT.—The table of chapters 

6 for subtitle E of title I of the Internal Revenue Code of 

7 1986 is amended by adding at the end the following new 

8 chapter: 

‘‘CHAPTER 56. MARIJUANA PRODUCTS’’. 

9 (e) EFFECTIVE DATE.— 

10 (1) IN GENERAL.—The amendments made by 

11 this section shall apply to sales, and applications for 

12 permits under section 5922 of the Internal Revenue 

13 Code of 1986 (as added by subsection (a)), after 

14 180 days after the date of the enactment of this Act. 

15 (2) SPECIAL RULES FOR EXISTING BUSI16 NESSES.—In the case of any producer operating 

17 under a permit issued on or before the date of the 

18 enactment of this Act under State law, the require19 ments under section 5922 of such Code (as so 

20 added) shall apply beginning on the date that is 6 

21 months after the date of the enactment of this Act. 

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1 TITLE II—REGULATION 

2 Subtitle A—Amendments To De3 criminalize Marijuana at the 

4 Federal Level 

5 SEC. 201. DECRIMINALIZATION OF MARIJUANA. 

6 (a) REMOVAL FROM SCHEDULE OF CONTROLLED

7 SUBSTANCES.—Notwithstanding any other provision of 

8 the Controlled Substances Act (21 U.S.C. 801 et seq.), 

9 the Attorney General shall, not later than 60 days after 

10 the date of the enactment of this Act, issue a final order 

11 that removes marijuana in any form from all schedules 

12 under section 202(c) of that Act (21 U.S.C. 812(c)). 

13 (b) CONFORMING AMENDMENT TO REMOVE LEGIS14 LATIVE DEADWOOD.—Subsection (c) of section 202 of the 

15 Controlled Substances Act (21 U.S.C. 812) is amended 

16 to read as follows: 

17 ‘‘(c) CROSS REFERENCE TO SCHEDULES OF CON18 TROLLED SUBSTANCES.—Schedules I, II, III, IV, and V 

19 shall consist of the drugs and other substances (by what20 ever official name, common or usual name, chemical name, 

21 or brand name designated) that are set forth in the respec22 tive schedules in part 1308 of title 21, Code of Federal 

23 Regulations, as they may be amended from time to time, 

24 or in any successor regulation.’’. 

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1 SEC. 202. APPLICATION OF THE CONTROLLED SUBSTANCES 

2 ACT AND CONTROLLED SUBSTANCES IMPORT 

3 AND EXPORT ACT TO MARIJUANA. 

4 Part A of the Controlled Substances Act (21 U.S.C. 

5 801 et seq.) is amended by adding at the end the fol6 lowing: 

7 ‘‘SEC. 103. APPLICATION TO MARIHUANA. 

8 ‘‘(a) GENERAL NONAPPLICATION.—Except as pro9 vided in this section, this title and title III do not apply 

10 to marihuana. 

11 ‘‘(b) EXCEPTION: PROHIBITION ON CERTAIN TRANS12 PORTATIONS AND SHIPMENTS.—It shall be unlawful to 

13 ship or transport marihuana from any place outside a 

14 State, territory, or district of the United States, or other 

15 place noncontiguous to but subject to the jurisdiction of 

16 the United States, into that State, territory, or district 

17 of the United States, or place, when such marihuana is 

18 intended by any person interested therein to be received, 

19 possessed, sold, or in any manner used, in violation of any 

20 law of such State, territory, district, or place. 

21 ‘‘(c) PENALTY.—Whoever knowingly violates sub22 section (b) shall be fined under title 18, United States 

23 Code, or imprisoned not more than one year, or both.’’. 

24 SEC. 203. CONFORMING AND ANCILLARY AMENDMENTS. 

25 (a) MODIFICATION OF DEFINITION OF ‘‘FELONY

26 DRUG OFFENSE’’.—Section 102(44) of the Controlled 

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1 Substances Act (21 U.S.C. 802(44)) is amended by strik2 ing ‘‘marihuana,’’. 

3 (b) ELIMINATION OF MARIJUANA PENALTY PROVI4 SIONS.—Part D of the Controlled Substances Act (21 

5 U.S.C. 841 et seq.) is amended— 

6 (1) in section 401— 

7 (A) by striking subsection (b)(1)(A)(vii); 

8 (B) by striking subsection (b)(1)(B)(vii); 

9 (C) by striking subsection (b)(1)(D); and 

10 (D) by striking subsection (b)(4); 

11 (2) in section 402(c)(2)(B), by striking ‘‘mari12 huana,’’; 

13 (3) in section 403(d)(1), by striking ‘‘mari14 huana,’’; 

15 (4) in section 418(a), by striking the last sen16 tence; 

17 (5) in section 419(a), by striking the last sen18 tence; 

19 (6) in section 422(d), in the matter preceding 

20 paragraph (1), by striking ‘‘marijuana,’’; and 

21 (7) in section 422(d)(5), by striking ‘‘, such as 

22 a marihuana cigarette,’’. 

23 (c) REMOVAL OF PROHIBITION ON IMPORT AND EX24 PORT.—Section 1010 of the Controlled Substances Import 

25 and Export Act (21 U.S.C. 960) is amended— 

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1 (1) by striking subparagraph (G) of subsection 

2 (b)(1); 

3 (2) by striking subparagraph (G) of subsection 

4 (b)(2); and 

5 (3) by striking paragraph (4) of subsection (b). 

6 (d) LIMITING THE APPLICATION OF THE NATIONAL

7 FOREST SYSTEM DRUG CONTROL ACT OF 1986 TO CON8 TROLLED SUBSTANCES OTHER THAN MARIJUANA.—The 

9 National Forest System Drug Control Act of 1986 is 

10 amended— 

11 (1) in section 15002(a) (16 U.S.C. 559b(a)) by 

12 striking ‘‘marijuana and other’’; 

13 (2) in section 15003(2) (16 U.S.C. 559c(2)) by 

14 striking ‘‘marijuana and other’’; and 

15 (3) in section 15004(2) (16 U.S.C. 559d(2)) by 

16 striking ‘‘marijuana and other’’. 

17 (e) INTERCEPTION OF COMMUNICATIONS.—Section 

18 2516 of title 18, United States Code, is amended— 

19 (1) in subsection (1)(e), by striking ‘‘mari20 huana,’’; and 

21 (2) in subsection (2) by striking ‘‘marihuana,’’. 

22 (f) NATIONAL YOUTH ANTI-DRUG MEDIA CAM23 PAIGN.—Section 709 of the Office of National Drug Con24 trol Policy Reauthorization Act of 1998 (21 U.S.C. 1708) 

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1 is amended by striking subsection (j) (relating to preven2 tion of marijuana use). 

3 Subtitle B—Federal Marijuana 

4 Licensing and Related Matters 

5 SEC. 211. FEDERAL MARIJUANA ADMINISTRATION. 

6 The Federal Alcohol Administration Act (27 U.S.C. 

7 201 et seq.) is amended by adding at the end the fol8 lowing: 

9 ‘‘TITLE III—MARIJUANA 

10 ‘‘SEC. 301. UNLAWFUL BUSINESSES WITHOUT MARIJUANA 

11 PERMIT. 

12 ‘‘(a) IMPORT.—It shall be unlawful, except pursuant 

13 to a permit issued under this title by the Secretary of the 

14 Treasury (hereinafter in this title referred to as the ‘Sec15 retary’)— 

16 ‘‘(1) to engage in the business of importing 

17 marijuana into the United States; or 

18 ‘‘(2) for any person so engaged to sell, offer or 

19 deliver for sale, contract to sell, or ship, in interstate 

20 or foreign commerce, directly or indirectly or 

21 through an affiliate, marijuana so imported. 

22 ‘‘(b) MANUFACTURE AND SALE.—It shall be unlaw23 ful, except pursuant to a permit issued under this title 

24 by the Secretary— 

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1 ‘‘(1) to engage in the business of cultivating, 

2 producing, manufacturing, packaging, or 

3 warehousing marijuana; or 

4 ‘‘(2) for any person so engaged to sell, offer or 

5 deliver for sale, contract to sell, or ship, in interstate 

6 or foreign commerce, directly or indirectly or 

7 through an affiliate, marijuana so cultivated, pro8 duced, manufactured, packaged, or warehoused. 

9 ‘‘(c) RESALE.—It shall be unlawful, except pursuant 

10 to a permit issued under this title by the Secretary— 

11 ‘‘(1) to engage in the business of purchasing 

12 marijuana for resale at wholesale; or 

13 ‘‘(2) for any person so engaged to receive or to 

14 sell, offer or deliver for sale, contract to sell, or ship, 

15 in interstate or foreign commerce, directly or indi16 rectly or through an affiliate, marijuana so pur17 chased. 

18 ‘‘(d) REMEDIES FOR VIOLATIONS.— 

19 ‘‘(1) CRIMINAL FINE.— 

20 ‘‘(A) GENERALLY.—Whoever violates this 

21 section shall be fined not more than $1,000. 

22 ‘‘(B) SETTLEMENT IN COMPROMISE.—The 

23 Secretary may decide not to refer a violation of 

24 this section to the Attorney General for pros25 ecution but instead to collect a payment from 

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1 the violator of no more than $500 for that vio2 lation. 

3 ‘‘(2) CIVIL ACTION FOR RELIEF.—The Attorney 

4 General may, in a civil action, obtain appropriate re5 lief to prevent and restrain a violation of this title. 

6 ‘‘SEC. 302. PROCEDURE FOR ISSUANCE OF MARIJUANA 

7 PERMITS. 

8 ‘‘(a) WHO ENTITLED TO PERMIT.— 

9 ‘‘(1) GENERALLY.—The Secretary shall issue a 

10 permit for operations requiring a permit under sec11 tion 301 unless the Secretary finds that— 

12 ‘‘(A) the applicant (or if the applicant is a 

13 corporation, any of its officers, directors, or 

14 principal stockholders) has been convicted of a 

15 disqualifying offense; 

16 ‘‘(B) the applicant is, by reason of busi17 ness experience, financial standing, or trade 

18 connections, not likely to commence operations 

19 within a reasonable period or to maintain such 

20 operations in conformity with Federal law; or 

21 ‘‘(C) the operations proposed to be con22 ducted by the applicant are in violation of the 

23 law of the State in which they are to be con24 ducted. 

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1 ‘‘(2) DISQUALIFYING OFFENSES.—For the pur2 poses of paragraph (1)— 

3 ‘‘(A) GENERALLY.—Except as provided in 

4 subparagraph (B) a disqualifying offense is an 

5 offense related to the production, consumption, 

6 or sale of marijuana that is— 

7 ‘‘(i) a felony under Federal or State 

8 law, if the conviction occurred not later 

9 than 5 years before the date of the applica10 tion; or 

11 ‘‘(ii) a misdemeanor under Federal 

12 law, if the conviction occurred not later 

13 than 3 years before the date of the applica14 tion. 

15 ‘‘(B) EXCLUDED OFFENSES.—A disquali16 fying offense does not include a Federal or 

17 State offense based on conduct that— 

18 ‘‘(i) was legal under State law in the 

19 State when and where the conduct took 

20 place, or 

21 ‘‘(ii) is, as of the date of the applica22 tion, no longer an offense in that State. 

23 ‘‘(b) REFUSAL OF PERMIT; HEARING.—If upon ex24 amination of any application for a permit the Secretary 

25 has reason to believe that the applicant is not entitled to 

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1 such permit, the Secretary shall so notify the applicant 

2 and, upon request by the applicant, afford the applicant 

3 due notice and opportunity for hearing on the application. 

4 If the Secretary, after affording such notice and oppor5 tunity for hearing, still finds that the applicant is not enti6 tled to a permit hereunder, the Secretary shall by order 

7 deny the application stating the findings which are the 

8 basis for the order. 

9 ‘‘(c) FORM OF APPLICATION.— 

10 ‘‘(1) GENERALLY.—The Secretary shall— 

11 ‘‘(A) prescribe the manner and form of ap12 plications for permits under this title (including 

13 the facts to be set forth in the application); 

14 ‘‘(B) prescribe the form of such permits; 

15 ‘‘(C) specify in any permit the authority 

16 conferred by the permit and the conditions of 

17 that permit in accordance with this title. 

18 ‘‘(2) SEPARATE TYPES OF APPLICATIONS AND

19 PERMITS.—To the extent deemed necessary by the 

20 Secretary for the efficient administration of this 

21 title, the Secretary may require separate applications 

22 and permits with respect to the various classes of 

23 marijuana, and with respect to the various classes of 

24 persons entitled to permits under this title. 

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1 ‘‘(3) DISCLAIMER.—The issuance of a permit 

2 under this title does not deprive the United States 

3 of any remedy for a violation of law. 

4 ‘‘(d) CONDITIONS.—A permit under this title shall be 

5 conditioned upon— 

6 ‘‘(1) compliance with all other Federal laws re7 lating to production, sale and consumption of mari8 juana, as well as compliance with all State laws re9 lating to said activities in the State in which the per10 mit applicant resides and does business; and 

11 ‘‘(2) payment to the Secretary of a reasonable 

12 permit fee in an amount determined by the Sec13 retary to be sufficient over time to offset the cost of 

14 implementing and overseeing all aspects of mari15 juana regulation by the Federal Government. 

16 ‘‘(e) REVOCATION, SUSPENSION, AND ANNUL17 MENT.— 

18 ‘‘(1) GENERALLY.—After due notice and oppor19 tunity for hearing, the Secretary may order a permit 

20 under this title— 

21 ‘‘(A) revoked or suspended for such period 

22 as the Secretary deems appropriate, if the Sec23 retary finds that the permittee has willfully vio24 lated any of the conditions of the permit, but 

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1 for a first violation of the conditions the permit 

2 shall be subject to suspension only; 

3 ‘‘(B) revoked if the Secretary finds that 

4 the permittee has not engaged in the operations 

5 authorized by the permit for a period of more 

6 than 2 years; or 

7 ‘‘(C) annulled if the Secretary finds that 

8 the permit was procured through fraud, or mis9 representation, or concealment of material fact. 

10 ‘‘(2) ORDER TO STATE BASIS FOR ORDER.— 

11 The order shall state the findings which are the 

12 basis for the order. 

13 ‘‘(f) SERVICE OF ORDERS.—Each order of the Sec14 retary with respect to any denial of application, suspen15 sion, revocation, annulment, or other proceedings, shall be 

16 served— 

17 ‘‘(1) in person by any officer or employee of the 

18 Secretary designated by him or any internal revenue 

19 or customs officer authorized by the Secretary for 

20 the purpose; or 

21 ‘‘(2) by mailing the order by registered mail, 

22 addressed to the applicant or respondent at his last 

23 known address in the records of the Secretary. 

24 ‘‘(g) DURATION.— 

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1 ‘‘(1) GENERAL RULE.—Except as otherwise 

2 provided in this subsection, a permit issued under 

3 this title shall continue in effect until suspended, re4 voked, or annulled as provided in this title, or volun5 tarily surrendered. 

6 ‘‘(2) EFFECT OF TRANSFER.—If operations 

7 under a permit issued under this title are trans8 ferred, the permit automatically terminates 30 days 

9 after the date of that transfer, unless an application 

10 is made by the transferee before the end of that pe11 riod for a permit under this title for those oper12 ations. If such an application is made, the out13 standing permit shall continue in effect until such 

14 application is finally acted on by the Secretary. 

15 ‘‘(3) DEFINITION OF TRANSFER.—For the pur16 poses of this section, the term ‘transfer’ means any 

17 change of ownership or control, whether voluntary or 

18 by operation of law. 

19 ‘‘(h) JUDICIAL REVIEW.—A permittee or applicant 

20 for a permit under this title may obtain judicial review 

21 under chapter 7 of title 5, United States Code, of the de22 nial of the application of that applicant or, in the case 

23 of a permittee, the denial of an application by the trans24 feree of that permittee. 

25 ‘‘(i) STATUTE OF LIMITATIONS.— 

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1 ‘‘(1) IN GENERAL.—No proceeding for the sus2 pension or revocation of a permit for violation of any 

3 condition thereof relating to compliance with Federal 

4 law shall be instituted by the Secretary more than 

5 18 months after conviction of the violation of Fed6 eral law, or, if no conviction has been had, more 

7 than 3 years after the violation occurred. 

8 ‘‘(2) COMPROMISE.—No permit shall be sus9 pended or revoked for a violation of any such condi10 tion thereof if the alleged violation of Federal law 

11 has been compromised by any officer of the Govern12 ment authorized to compromise such violation. 

13 ‘‘SEC. 303. DEFINITIONS. 

14 ‘‘In this title— 

15 ‘‘(1) the term ‘marijuana’ has the meaning 

16 given the term ‘marihuana’ in section 102 of the 

17 Controlled Substances Act (21 U.S.C. 802); and 

18 ‘‘(2) the term ‘State’ includes the District of 

19 Columbia, Puerto Rico, and any territory or posses20 sion of the United States.’’. 

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1 SEC. 212. ADDITION OF MARIJUANA TO CERTAIN LEGAL AU2 THORITIES RELATING TO INTOXICATING LIQ3 UORS. 

4 (a) WILSON ACT.—The Act of August 8, 1890 (com5 monly known as the Wilson Act or the Original Packages 

6 Act; 27 U.S.C. 121), is amended— 

7 (1) by inserting ‘‘, or marijuana,’’ after ‘‘intoxi8 cating liquors or liquids’’; and 

9 (2) by striking ‘‘such liquids or liquors’’ and in10 serting ‘‘such liquids, liquors, or marijuana’’. 

11 (b) WEBB-KENYON ACT.—The Act of March 1, 1913 

12 (commonly known as the Webb-Kenyon Act; 27 U.S.C. 

13 122), is amended— 

14 (1) by inserting ‘‘marijuana or any’’ after 

15 ‘‘whatsoever, of any’’; and 

16 (2) by inserting ‘‘marijuana or’’ after ‘‘which 

17 said’’. 

18 (c) VICTIMS OF TRAFFICKING AND VIOLENCE PRO19 TECTION ACT OF 2000.—Section 2 of the Victims of Traf20 ficking and Violence Protection Act of 2000 (27 U.S.C. 

21 122a) is amended— 

22 (1) in subsection (a)— 

23 (A) by redesignating paragraphs (3) and 

24 (4) as paragraphs (4) and (5), respectively; and 

25 (B) by inserting after paragraph (2) the 

26 following new paragraph: 

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1 ‘‘(3) the term ‘marijuana’ has the meaning 

2 given the term ‘marihuana’ in section 102 of the 

3 Controlled Substances Act (21 U.S.C. 802);’’; and 

4 (2) in subsections (b) and (c), by inserting ‘‘or 

5 marijuana’’ after ‘‘intoxicating liquor’’ each place it 

6 appears. 

7 Subtitle C—Other Amendments Re8 lating to Federal Authority Re9 garding Marijuana 

10 SEC. 221. FOOD AND DRUG ADMINISTRATION. 

11 The Food and Drug Administration shall have the 

12 same authorities with respect to marijuana as the Admin13 istration has with respect to alcohol. 

14 SEC. 222. TRANSFERRING AGENCY FUNCTIONS WITH RE15 GARD TO MARIJUANA. 

16 (a) TRANSFER OF JURISDICTION FROM DRUG EN17 FORCEMENT ADMINISTRATION TO BUREAU OF ALCOHOL, 

18 TOBACCO, FIREARMS AND EXPLOSIVES.—The functions 

19 of the Attorney General, acting through the Administrator 

20 of the Drug Enforcement Administration relating to mari21 juana enforcement, shall hereafter be administered by the 

22 Attorney General, acting through the Director of the Bu23 reau of Alcohol, Tobacco, Firearms and Explosives. 

24 (b) REDESIGNATION OF BUREAU OF ALCOHOL, TO25 BACCO, FIREARMS AND EXPLOSIVES AS BUREAU OF ALmstockstill on DSK3G9T082PROD with BILLS

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1 COHOL, TOBACCO, MARIJUANA, FIREARMS AND EXPLO2 SIVES.— 

3 (1) REDESIGNATION.—The Bureau of Alcohol, 

4 Tobacco, Firearms and Explosives is hereby re5 named the ‘‘Bureau of Alcohol, Tobacco, Marijuana, 

6 Firearms and Explosives’’. 

7 (2) REFERENCES.—Any reference to the Bu8 reau of Alcohol, Tobacco, Firearms and Explosives 

9 in any law, regulation, map, document, record, or 

10 other paper of the United States shall be deemed to 

11 be a reference to the Bureau of Alcohol, Tobacco, 

12 Marijuana, Firearms and Explosives. 

13 (c) REDESIGNATION OF ALCOHOL AND TOBACCO

14 TAX AND TRADE BUREAU AS ALCOHOL, TOBACCO, AND

15 MARIJUANA TAX AND TRADE BUREAU.— 

16 (1) REDESIGNATION.—The Alcohol and To17 bacco Tax and Trade Bureau is hereby renamed the 

18 ‘‘Alcohol, Tobacco, and Marijuana Tax and Trade 

19 Bureau’’. 

20 (2) REFERENCES.—Any reference to the Alco21 hol and Tobacco Tax and Trade Bureau in any law, 

22 regulation, map, document, record, or other paper of 

23 the United States shall be deemed to be a reference 

24 to the Alcohol, Tobacco, and Marijuana Tax and 

25 Trade Bureau. 

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1 SEC. 223. UNFAIR ADVERTISING PRACTICES. 

2 (a) IN GENERAL.—It shall be unlawful for any per3 son engaged in the business of importing marijuana into 

4 the United States, or cultivating, producing, manufac5 turing, packaging, or warehousing marijuana, or pur6 chasing marijuana for resale at wholesale, directly or indi7 rectly or through an affiliate, to publish or disseminate 

8 or cause to be published or disseminated by radio broad9 cast, or in any newspaper, periodical or other publication 

10 or by any sign or outdoor advertisement or any other 

11 printed or graphic matter, any advertisement of mari12 juana, if such advertisement is in, or is calculated to in13 duce sales in, interstate or foreign commerce, or is dis14 seminated by mail, unless such advertisement is in con15 formity with such regulations, to be prescribed by the Sec16 retary of the Treasury, or the Secretary’s delegate (re17 ferred to in this section as the ‘‘Secretary’’), as will— 

18 (1) prevent deception of the consumer with re19 spect to the products advertised and as will prohibit, 

20 irrespective of falsity, such statements relating to 

21 manufacturing processes, analyses, guaranties, and 

22 scientific or irrelevant matters as the Secretary finds 

23 to be likely to mislead the consumer; 

24 (2) provide the consumer with adequate infor25 mation as to the identity and quality of the products 

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1 advertised, the characteristics thereof, and the per2 son responsible for the advertisement; 

3 (3) prohibit statements that are disparaging of 

4 a competitor’s products or are false, misleading, ob5 scene, or indecent; and 

6 (4) prevent statements inconsistent with any 

7 statement on the labeling of the products advertised. 

8 (b) NONAPPLICATION TO PUBLISHERS AND BROAD9 CASTERS.—The prohibitions of this section and regula10 tions thereunder shall not apply to the publisher of any 

11 newspaper, periodical, or other publication, or radio broad12 caster, unless such publisher or radio broadcaster is en13 gaged in the business of importing marijuana into the 

14 United States, or cultivating, producing, manufacturing, 

15 packaging, or warehousing marijuana, or purchasing 

16 marijuana for resale at wholesale, directly or indirectly or 

17 through an affiliate. 

18 SEC. 224. COMPTROLLER GENERAL REVIEW OF LAWS AND 

19 REGULATIONS. 

20 The Comptroller General shall conduct a review of 

21 Federal laws, regulations, and policies to determine if any 

22 changes in them are desirable in the light of the purposes 

23 and provisions of this Act. Not later than 2 years after 

24 the date of the enactment of this Act, the Comptroller 

25 General shall make to Congress and the relevant agencies 

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1 such recommendations relating to the results of that re2 view as the Comptroller General deems appropriate. 

3 TITLE III—FUNDING 

4 SEC. 301. FUNDING FOR THE ALCOHOL, TOBACCO, AND 

5 MARIJUANA TAX AND TRADE BUREAU. 

6 (a) INCREASED FUNDING FOR THE ALCOHOL, TO7 BACCO, AND MARIJUANA TAX AND TRADE BUREAU.—For 

8 necessary expenses of carrying out section 1111(d) of the 

9 Homeland Security Act of 2002 (6 U.S.C. 531(d)), there 

10 are authorized to be appropriated— 

11 (1) for fiscal year 2017, $116,439,000, to re12 main available until September 30, 2018; and 

13 (2) for fiscal year 2018, $119,081,000, to re14 main available until September 30, 2019. 

15 (b) AVAILABILITY OF FUNDS FOR ADMINISTRATION

16 OF MARIJUANA TAXATION.—Of the amounts authorized 

17 to be appropriated under subsection (a), for each of fiscal 

18 years 2017 and 2018, $10,000,000 shall be for the pur19 pose of carrying out the provisions of this Act and the 

20 amendments made by this Act. 

Æ 

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