NEW: Marijuana excise tax rates change
Beginning July 1, 2015, the excise tax structure for recreational marijuana is changing.
Under the new law (2E2SHB 2136), the marijuana excise tax is:
- No longer levied on the producers, processors and retailers. Instead, the tax is now imposed on retail customers.
- Going from 25 percent (at each level) to 37 percent on the retail customer.
- No longer part of the selling price subject to retail sales or B&O taxes.
This tax is still paid to the Liquor and Cannabis Board (formerly called Liquor Control Board). Producers, processors and retailers must still pay B&O and retail sales taxes, as applicable, to Revenue. Visit the LCB website for more information on the excise tax.
Applying for a retail license and medical endorsement
The LCB will soon begin accepting applications for retail marijuana licenses, including medical endorsements. When the LCB is ready to accept applications, the applications will be available through the Department’s Business Licensing Service. Interested applicants should visit the LCB’s website to learn about the application process: http://www.liq.wa.gov/mjlicense/marijuana-licensing.
Priority one and two applicants will need to submit a tax status letter from the Department. See our webpage on requesting a tax status letter. (See LCB’s webpage on Priority Criteria to learn more about applicant priorities. You may also contact LCB directly at (360) 664-1600.)
Applicants may also need to verify that their business maintained a state business registration (license) and was in operation before January 1, 2013. You can do this by using our business lookup
Do you hold a producer, processor or retailer marijuana business license issued by the Liquor and Cannabis Board? If so, you will also owe taxes to the Washington State Department of Revenue.
Business and occupation (B&O) tax applies to your business’s gross receipts. You also must collect and remit to Revenue the sales tax on your retail transactions. The fact sheets at right explain your obligations.
No tax exemptions apply
These products do not qualify for either the sales tax exemption for prescription drugs or the sales tax exemption for food and food ingredients. None of Washington’s tax preferences for agricultural products or property tax incentives apply to marijuana businesses.
How to file and pay your taxes
Log on to Revenue’s My Account to file your monthly returns. You must file each month. If you have no business activity to report, you still must file a "no business" return.
You can also pay your taxes through My Account.
Businesses that cannot pay electronically must apply for a waiver and, in the meantime, pay their taxes by check, money order or cash.
Mail checks to:
Washington State Department of Revenue
PO Box 47464
Olympia WA 98504-7464
Cash payments – where to pay
You may pay your taxes in cash at any Revenue office. Appointments are necessary for tax payments of $20,000 or more. Please schedule your appointment before the due date. We encourage early payments (before the 25th) if using cash. Penalties may apply if you don’t pay your taxes by the 25th. See Requirements for making cash payments.
Excise taxes (37 percent) paid to Liquor and Cannabis Board
Revenue is NOT accepting tax payments for the Liquor and Cannabis Board. Excise taxes due must be paid to LCB.