Jacob Redmond
Well-Known Member
Every month, Randy Huff, owner of a medical marijuana dispensary, writes a check for about $500 to the city of La Pine.
Huff owns Green Knottz, one of two dispensaries in the central Oregon community where leaders last spring decided to impose a 5 percent tax on medical marijuana transactions.
"It's really expensive every month," said Huff, who this week wrote out a check for $511.43 to pay taxes for October sales.
While many Oregon communities are expected to push for a tax on recreational cannabis next year, La Pine may be unique in imposing a tax on medical marijuana. Representatives with the League of Oregon Cities and the Association of Oregon Counties each said they were unaware of other cities or counties taxing medical cannabis.
Such a tax may be on shaky ground legally, according to an opinion issued this week by the Office of Legislative Counsel. In a letter to Sen. Floyd Prozanski, D-Eugene, attorney Mark Mayer wrote that a state law passed this year doesn't allow cities and counties to tax medical marijuana.
Local governments may, however, may pursue a tax on marijuana sold by retailers with an Oregon Liquor Control Commission license. (Medical marijuana dispensaries are regulated by the Oregon Health Authority.) Whether to impose a tax must be decided by local voters during a statewide general election.
And by law, the local tax on recreational cannabis can't exceed three percent.
"In short," wrote Mayer, "under this provision of law, a city or county is prohibited from imposing a tax or fee of any sort on a medical marijuana dispensary."
For now, recreational marijuana is sold tax-free at dispensaries, but will be subject to a 25 percent tax starting in January. That tax will end once the Oregon Liquor Control Commission launches its recreational stores late next year. Under the OLCC, marijuana will be taxed at 17 to 20 percent, depending on whether local communities opt to add the 3 percent tax.
Madras Mayor Royce Embanks said city leaders approved a tax on medical marijuana last year but later repealed it due to a range of concerns. He said officials worried that if the tax ultimately was determined to be illegal, they'd have to return the cash to businesses, which would be in the position of having to return it to customers.
And, he said, officials were concerned about the implications of taking money from businesses that deal in marijuana, which remains illegal under federal law.
La Pine City Manager Rick Allen was surprised to hear La Pine stands out for its medical marijuana tax.
He said marijuana policies, like taxation, are fluid and evolving, making it challenging for local government officials to keep up.
"People are struggling to get their arms around and elected officials are struggling to figure it out," he said. "We aren't looking to be the poster child for any movement, pro or con, on any of this. We are just trying to manage it."
Allen said the city council is expected to take up the medical marijuana tax, and review the latest opinion from the Office of Legislative Council, at its December meeting.
So far, La Pine has collected $5,409.76 in medical marijuana taxes.
"Not knowing where this all will shake out we will not spend it on anything," he said. "It's just sitting there."
Matt Toepfer, who owns High Desert Botanicals, other dispensary in La Pine, said his monthly tax bill is one of his biggest financial obligation. He said his monthly tax bill is, on average, $700.
"We pay way more in taxes a month to the city than we do our own rent and some of our other big bills," he said.
Toepfer said when the tax was initially imposed earlier this year, his talked with customers about how they felt paying the additional expense. He said they were so outraged by the prospect of paying taxes that he decided to pay it out of his own pocket instead.
"We are not passing that tax onto the customer," said Toepfer. "We are eating it every month."
News Moderator: Jacob Redmond 420 MAGAZINE ®
Full Article: City Taxes Medical Marijuana, But May Be On Shaky Ground
Author: Noelle Crombie
Contact: Contact The News Team
Photo Credit: The Associated Press
Website: Oregon Live
Huff owns Green Knottz, one of two dispensaries in the central Oregon community where leaders last spring decided to impose a 5 percent tax on medical marijuana transactions.
"It's really expensive every month," said Huff, who this week wrote out a check for $511.43 to pay taxes for October sales.
While many Oregon communities are expected to push for a tax on recreational cannabis next year, La Pine may be unique in imposing a tax on medical marijuana. Representatives with the League of Oregon Cities and the Association of Oregon Counties each said they were unaware of other cities or counties taxing medical cannabis.
Such a tax may be on shaky ground legally, according to an opinion issued this week by the Office of Legislative Counsel. In a letter to Sen. Floyd Prozanski, D-Eugene, attorney Mark Mayer wrote that a state law passed this year doesn't allow cities and counties to tax medical marijuana.
Local governments may, however, may pursue a tax on marijuana sold by retailers with an Oregon Liquor Control Commission license. (Medical marijuana dispensaries are regulated by the Oregon Health Authority.) Whether to impose a tax must be decided by local voters during a statewide general election.
And by law, the local tax on recreational cannabis can't exceed three percent.
"In short," wrote Mayer, "under this provision of law, a city or county is prohibited from imposing a tax or fee of any sort on a medical marijuana dispensary."
For now, recreational marijuana is sold tax-free at dispensaries, but will be subject to a 25 percent tax starting in January. That tax will end once the Oregon Liquor Control Commission launches its recreational stores late next year. Under the OLCC, marijuana will be taxed at 17 to 20 percent, depending on whether local communities opt to add the 3 percent tax.
Madras Mayor Royce Embanks said city leaders approved a tax on medical marijuana last year but later repealed it due to a range of concerns. He said officials worried that if the tax ultimately was determined to be illegal, they'd have to return the cash to businesses, which would be in the position of having to return it to customers.
And, he said, officials were concerned about the implications of taking money from businesses that deal in marijuana, which remains illegal under federal law.
La Pine City Manager Rick Allen was surprised to hear La Pine stands out for its medical marijuana tax.
He said marijuana policies, like taxation, are fluid and evolving, making it challenging for local government officials to keep up.
"People are struggling to get their arms around and elected officials are struggling to figure it out," he said. "We aren't looking to be the poster child for any movement, pro or con, on any of this. We are just trying to manage it."
Allen said the city council is expected to take up the medical marijuana tax, and review the latest opinion from the Office of Legislative Council, at its December meeting.
So far, La Pine has collected $5,409.76 in medical marijuana taxes.
"Not knowing where this all will shake out we will not spend it on anything," he said. "It's just sitting there."
Matt Toepfer, who owns High Desert Botanicals, other dispensary in La Pine, said his monthly tax bill is one of his biggest financial obligation. He said his monthly tax bill is, on average, $700.
"We pay way more in taxes a month to the city than we do our own rent and some of our other big bills," he said.
Toepfer said when the tax was initially imposed earlier this year, his talked with customers about how they felt paying the additional expense. He said they were so outraged by the prospect of paying taxes that he decided to pay it out of his own pocket instead.
"We are not passing that tax onto the customer," said Toepfer. "We are eating it every month."
News Moderator: Jacob Redmond 420 MAGAZINE ®
Full Article: City Taxes Medical Marijuana, But May Be On Shaky Ground
Author: Noelle Crombie
Contact: Contact The News Team
Photo Credit: The Associated Press
Website: Oregon Live
