The Oregon Senate sent a bill to the House this week that would allow cities and counties to more than triple the local sales tax on cannabis.
On Wednesday Senate Bill 864 passed the Senate in an overwhelming 23-6 vote. State Sens. Floyd Prozanski, Sara Gelser and Dallas Heard were among the “No” votes while State Sen. James Manning was excused.
The House held a first reading and sent the bill to the Revenue committee the same day.
If Senate Bill 864 is approved and signed by Oregon’s governor, it would take effect on January 1st of 2022.
The bill would increase from 3% to 10% the tax that cities and counties can impose on the retail sale of recreational cannabis. A city would have to transfer 20% of tax collections to the county where the city is located.
Currently cannabis in Oregon is taxed at the point of sale 17% by the state; local governments can impose up to a 3% tax.
The passage of Measure 110 will impact how those tax revenues can be spent.
Before Measure 110, state cannabis revenue was split 40% to the State School Fund; 20% to mental health service; 5% to alcohol and drug abuse prevention; 15% percent to the State Police; and 10% went each to cities and counties.
“Measure 110 limited these uses to $45 million each year effective January 1, 2021, any amounts above that are transferred to the Drug Treatment and Recovery Services,” according to the Revenue Office.
