The Alaska Legislature is on the verge of making a significant change to the state’s recreational marijuana law, which voters legalized in 2014. The Alaska House of Representatives has voted to replace the current $50 per ounce marijuana tax with a 7% sales tax. If approved by the Senate and Gov. Mike Dunleavy, this would be Alaska’s first statewide sales tax.
The change was recommended by the state’s recreational marijuana task force, which Dunleavy convened in 2022 to review the industry and identify areas for improvement.
Alaska House Approves Marijuana Tax Reform Bill
The current tax structure has been criticized by the marijuana industry, which claims it is too high and makes it difficult to compete with the black market. The task force originally recommended a 3% sales tax, but this was increased to 7% during the legislative process.
While the industry would have preferred a lower tax rate, they still support the bill, which includes other recommendations from the task force, such as plant tracking and licensing changes.
The bill’s passage in the House is seen as a significant step forward for the industry struggling to compete with the black market. The high tax rate has made it difficult for licensed businesses to operate profitably, and many have been forced to shut down. The new tax structure is expected to help level the playing field and allow licensed businesses to thrive.
The bill now moves to the Senate for consideration, where it is expected to face further debate and discussion. If approved, the new tax structure would go into effect in 2024 and would be a significant step forward for the state’s recreational marijuana industry.
