Last week the Italian government tabled proposals aiming to regulate the nation’s booming ‘cannabis light’ industry.
The administration of recently instated Italian Prime Minister Gorgia Meloni proposed an amendment to Bill 1038 on June 20, 2023, seeking to extend tobacco legislation to cover the low THC hemp flower sold commonly for consumption throughout Italy.
These sweeping amendments laid out plans to create a tax framework, while establishing an authorisation system through the Customs and Monopolies Agency (ADM).
However, a day later, the government u-turned on its decision and withdrew the proposals for an amendment, but both local media and industry sources believe the proposals are set to soon be reintroduced in a different bill.
The proposals
The amendment proposals encompassed a number of key points, the first of which covered taxation.
Under the new framework, sales of all cannabis-light products would be taxed at 56.5%, bringing them in line with the current levels of tobacco taxation.
Italian cannabis industry association Canapa Sativa Italia (CSI), which was instrumental in the overturning of ‘absurdly restrictive’ legislation earlier this year which meant hemp leaves and flowers were considered narcotics in the eyes of regulators, believes this level of taxation is likely to ‘hinder the development of the Italian hemp industry’.
The amendment would also place limits on where cannabis light can be sold, restricting sales to authorised tobacconists who hold a specialised licence.
Furthermore, these businesses would be required to use ‘authorised tax warehouses’ and under particular supervisory measures’.
In Italy, tax warehouses are physical buildings where goods are stored which allow businesses to keep and process domestic and imported goods without paying for VAT, provided that they are not destined for sale inside the warehouse.
The advantage of storing goods imported into VAT warehouses is that the goods are in free circulation and can be picked up at any time without any special formalities.
READ MORE: Italian Court Rules Hemp Flower And Leaves Are Not Narcotic In Latest Victory For Industry
Concerns have been raised that both of these measures could penalise smaller business and artisanal producers who have been part of the industry for years.
Furthermore, many small businesses would struggle to manage tax warehouses and ensure product quality, as products are ‘subject to perishability and some manual processing’.
The CSI said: “These provisions, if not adequately weighted, risk favoring the emergence of a new black market, encouraged by the lower cost for consumers and the higher quality of handicraft products.”
Alongside suggestions that smoking cannabis light would be banned indoors, and the packaging would need to contain warnings just like tobacco, the proposals also covered the prohibition of distance selling.
In an effort to restrict sales to under 18s, the ban on distance selling would mean online sales, as well as via vending machines would not be allowed.
What next?
The reaction to the proposals have been mixed, with some supporting the introduction of a regulatory framework for cannabis light, while others believe this is the latest effort from Ms Meloni’s government to crack down on the substance.
The current administration, which has been described by campaigners as the ‘most prohibitionist government ever’, has made repeated efforts to clamp down on the industry.
In February 2023, during the ‘Canapa Mundi’ festival, which reportedly saw some 25,000 attendees and 230 cannabis light and hemp brands showcase their businesses, was raided by police who carried out searches and handed out fines.
Following the festival, businesses selling cannabis light and other hemp products across the country reported intensifying checks and searches by police.
In March, Ms Meloni’s government revealed that these growing checks were part of a new initiative it suggests was aimed at ‘raising awareness of commercial operations’, but which campaigners argue is a thinly veiled effort to repress the industry.
It has now been suggested that this initiative was a precursor to the recently tabled proposals, seeing the government use it to establish the size of the industry before making plans to regulate it.
Elsewhere, lawyer Giacomo Bulleri told Canapaindustriale.it that he welcomed the proposals, arguing that it provides an opportunity to regulate the market.
“Absolutely I see it favourably, it is an opportunity because it is being regulated as a product that has always been an inhalation product and it is being framed according to the standards, as Belgium and Luxembourg, as well as Switzerland, have done in Europe.
“I see it as an opportunity. Instead of continuing with uncertainty, it is better to have a certain rule which is clearly trenchant because the consequence will no longer be the discussion on drug effectiveness, the crime would be smuggling , a very serious crime”.
Another industry lawyer, Carlo Alberto Zaina, told Dolcevitaonline.it that the government is trying to make money out of an industry they have ‘criminalised for years’.
“Certainly we are proceeding towards regulation, but we must take note of the underlying hypocrisy. If it were to be regulated, other ways could have been found… I don’t think this is the best way.”
Regardless of the government’s intentions, it appears regulation has been temporarily postponed, seeing it withdraw the amendment last minute.
Despite this, local media has reported that the proposals are likely to soon be resubmitted as part of another bill.
