OKLAHOMA CITY – The medical marijuana industry may take a big hit if a Republican lawmaker gets his way when the Oklahoma Legislature convenes in February.
State Sen. George Burns (R-Pollard) has filed a measure that would move the sales tax exemption for marijuana growers and processors. Currently, growers and processors are on the list of agricultural products that are available to receive an exemption.
Bud Scott, executive director of the Oklahoma Cannabis Industry Association, did not return multiple telephone calls for comment on this story.
Oklahoma’s medical marijuana industry has boomed since its approval by Oklahoma voters in 2018 by State Question 788, but has left confusion among agencies, lawmakers and citizens as rules have been developed to regulate the industry.
The Oklahoma Tax Commission previously determined that medical marijuana growers could qualify for an agricultural sales tax exemption based on proposed emergency rules that passed following the approval of the state question, but nothing has been placed in state statutes. This exemption allows the holder of an agricultural exemption permit to purchase tangible personal property to be used in agricultural production.
Specifically, Burns believes removing marijuana growers and processors from the list of approved industries and products eligible to receive an ag sales tax exemption would create additional revenue from the medical marijuana industry that could be used to hire more law enforcement officers to further regulate the industry and weed out illegal grows.
“There’s more than 8,000 marijuana growers licensed with the state – but how many more are operating illegally without oversight from the Oklahoma Medical Marijuana Authority,” Burns said. “We need to ensure this industry is well-regulated. There have been numerous reports that illegal grows have brought additional drugs and crime into our state, and it’s time we put our foot down and say ‘enough is enough.’ However, we need to have sufficient funding available to give the OMMA and Bureau of Narcotics the resources to go into these grows and make sure they are compliant. My hope is that by subjecting marijuana growers, harvesters, and processers to a sales tax, we can use the extra revenue created to boost funding for the law enforcement arms of the marijuana industry, therefore protecting all Oklahomans.”
So far, no fiscal analysis has been conducted to determine how much revenue would be generated from this proposal. In addition, Burns did not specify in his Senate Bill 1101 how many additional law enforcement agents would be needed.
Oklahoma has nearly 12,600 marijuana business licenses, including more than 8,600 growers and nearly 2,300 dispensaries, The Denver Post reported in August. That’s more than double Colorado’s combined recreational and medical stores – despite the fact that Oklahoma has about 1.8 million fewer people, according to the newspaper’s reporting. Colorado has more than 1,200 cultivation operations, which is seven times fewer than Oklahoma.
Nearly 376,000 Oklahomans – roughly 10% of the state’s population – have medical marijuana cards, by far the highest share in the country, according to the Marijuana Policy Project.
The state legislature will begin its business Monday, Feb. 7.