Nevada Estimating $529K to Cover Cost of Collecting New Medical Marijuana Tax

NEVADA: Nevada tax officials say the state will have to spend money before it can make money from a new tax on the sale of medical marijuana.

The Nevada Department of Taxation has requested $529,000 from a special legislative fund to cover the cost of collecting the dispensary excise tax that Gov. Brian Sandoval signed into law earlier this year. The tax goes into effect next year.

The state Board of Examiners, chaired by the Republican governor, is scheduled to consider the funding request on Tuesday in Carson City before it’s forwarded to the Legislature’s Interim Finance Committee on Aug. 29.

State officials have no estimate on the overall fiscal impact, but advocates of the new system say the tax could raise up to $30 million a year.

Nevada voters approved medical pot more than a decade ago, but the only legal way to get the drug has been for cardholders to grow it themselves.

The 2013 law that permits the dispensing of medical marijuana includes a provision that a 2 percent excise tax be imposed both on wholesale and retail sales.

The tax was added to the bill late in the session and did not include any money for the tax department to set up a process to collect it.

Sen. Tick Segerblom, D-Las Vegas, a key sponsor of the medical marijuana bill, said $529,226 seems “incredibly high” since it will be sometime in mid-2014 before the sales start.

Segerblom noted the department initially told the governor the collections would cost $2 million.

 

Read full article @ The Republic