In this episode Lew and I discuss the potential impact on state revenues of two pieces of legislation:
- 2SSB 5052, which passed both houses of the legislature and has been signed (with partial vetoes) by the governor, integrates the medical marijuana market created by 1998's Initiative 692 into the recreational marijuana market created by 2013's Initiative 502. This will expand the number of transactions subject to marijuana excise tax established by I-502.
- ESSB 6062, which has passed the senate, would reform the marijuana excise tax system. The current tax rate is 25 percent. This tax is applied sequentially at each step (production, distribution and retail sale) as marijuana passes from grower to consumer. Under ESSB 6062, the tax rate would increase to 37 percent but would only be applied once, when the produced is sold at retail. ESSB 6062 would redirect most of the proceeds from the excise tax to the education legacy trust account.