Taxes on Cannabis products in Oregon could triple

The Oregon Senate sent a bill to the House of Representatives this week that would allow cities and counties to more than triple local sales tax on cannabis. On Wednesday, Senate Bill 864 passed the Senate with an overwhelming 23-6 vote. State Sens. Floyd Prozanski, Sara Gelser and Dallas Heard were among the "no" votes, while State Sen. James Manning was excused. The House of Representatives held a first reading and sent the bill to the Revenue Committee that same day. If Senate Bill 864 is approved and signed by the Oregon Governor, it would go into effect January 1, 2022. The bill would increase the tax that cities and counties can levy on retail sales of recreational cannabis from 3% to 10%. A city would have to pay 20% of the tax revenue to the district in which the city is located. Currently, cannabis in Oregon is state taxed at 17% at the point of sale; local governments can impose a tax of up to 3%. The passage of Measure 110 will have an impact on how this tax revenue can be spent. Before measure 110, 40% of the state's cannabis income went to the state school fund, 20% to psychiatric care, 5% to alcohol and drug abuse prevention, 15% to the state police and 10% each to the cities and districts distributed. "Measure 110 limited these uses to $ 45 million per year effective Jan. 1, 2021, and any amounts beyond that will be transferred to drug treatment and recovery services," according to the Revenue Office.