Taxes on marijuana could reach up to 20 percent, under a marijuana law rewrite Massachusetts lawmakers announced Monday.
The proposed taxes break down as follows: 6.25 percent sales tax, state excise tax at 10.75 percent and local option tax of up to 3 percent that can be set by cities and towns.
“I anticipate most communities if not all will be at 3 percent,” said Rep. Mark Cusack, a member of small group of lawmakers who worked on the compromise behind closed doors at the State House.
Cities and towns could also receive an additional 3 percent through a community host agreement with a retail pot shop company.
“In addition, we also require as part of the licensing process that [retail pot shop companies] have a host agreement with the host community, but we cap that at 3 percent of gross sales,” he said. That could bring the total potential tax rate at 23 percent.
The law passed by 1.8 million voters in November set the tax rate at up to 12 percent. The law, which broadly legalized recreational use of marijuana for adults age 21 and over, also called for a voter referendum process to determine the fate of possible retail pot shops.
Under the deal announced Monday, Massachusetts communities that voted in November against the recreational marijuana ballot question will be able to ban local pot shops through action taken by their locally elected officials. Communities that voted “yes” have to hold a voter referendum if they want to ban or restrict pot shops.
But after December 31, 2019, all communities will have to hold a voter referendum, under the proposed compromise. “Any community that voted ‘no’ last November I presume will be acting before that deadline,” Cusack said.
The deal could be on Gov. Charlie Baker’s desk before