Alaska Home approves marijuana tax reform, advancing invoice to Senate

Up to date: Might 20, 2024 Revealed: Might 12, 2024

A decade after Alaska voters legalized leisure marijuana, the Alaska Legislature is advancing the primary main change to the legislation that opened business gross sales right here.

On Friday, the Alaska Home of Representatives voted to alter the state’s $50 per ounce marijuana tax to a 7% gross sales tax.

If Home Invoice 119 is accepted by the Senate and Gov. Mike Dunleavy, it will impose Alaska’s first statewide gross sales tax. That pioneering idea troubled some legislators, however the invoice nonetheless handed the Home by a 36-3 vote.

The tax change was really helpful by the state’s leisure marijuana process drive, which Dunleavy convened in 2022 to investigate the marijuana trade and decide whether or not facets of the trade’s enabling legislation — handed by voters in 2014 — ought to be modified.

Ten years in the past, Alaska joined Oregon because the third and fourth states to legalize leisure marijuana use. Since then, many different states have adopted swimsuit, however Alaska’s marijuana tax — levied on the wholesale degree — is the best within the nation.

Members of the marijuana trade have requested for tax aid, saying that they’re unable to efficiently compete with black-market marijuana at current charges of taxation.

As well as, there are indicators that the tax construction is counterproductive. The $50 per-ounce tax applies solely to common bud or flower; there are decrease taxes for flawed buds or for trim — lower marijuana buds — and producers have shifted towards these lower-taxed merchandise.

The duty drive’s authentic advice was a 3% gross sales tax, however invoice supporter Rep. Jesse Sumner, R-Wasilla, mentioned he believed that determine was too low and wouldn’t get legislative help. He proposed a ten% tax that was later lowered to six%. On the Home ground, that was raised by modification to 7%.

Sumner mentioned he believes the upper determine might make the invoice extra engaging to the state Senate, which should vote on the invoice earlier than it could actually advance to the governor’s desk.

Ryan Tunseth, president of the Alaska Marijuana Business Affiliation, a commerce group, mentioned he was excited to see the invoice move the Home, even with a tax fee greater than most well-liked by the trade.

He mentioned he intends to ballot marijuana companies over the weekend to get their impressions, and he hopes that the ultimate model of the invoice can even embody different process drive suggestions, together with modifications to plant monitoring and licensing.

Initially revealed by the Alaska Beacon, an impartial, nonpartisan information group that covers Alaska state authorities.