Marijuana tax collections hit new high
Tax collections for the medical marijuana industry hit a new high in August, showing revenue growth for the 11th straight month since the first tax collections in October 2018.
Oklahoma collected nearly $2.8 million in August in Medical Marijuana Tax, as well as nearly $3.6 million in sales tax at medical marijuana dispensaries. The tax revenues combined for more than $6.3 million.
The sales tax is assessed at the same rates as other products and varies throughout the state, while the Medical Marijuana Tax is a 7% additional tax for medical marijuana sold to consumers by dispensaries.
Both hit new highs for the industry, but are showing signs of slowing as the industry approaches an equilibrium point.
The Medical Marijuana tax grew by 12% from July to August, compared to 15% and 34% the months prior. Sales tax showed similar decline, growing 13% from July to August, down from 15% and 31% in the two months prior.
Employment numbers still catching up
Jobs in the industry are increasing, although the amount measured remains small, based off information released by the Oklahoma Employment Security Commission.
Employment data takes time to be reported and processed, and the latest information available only goes through the first quarter of 2019.
In that time, 544 retail establishments were reported, employing 2,572. These numbers are counted in the category “All Other Miscellaneous Store Retailers (except Tobacco Stores)” and show a slight increase from the totals at the end of the first quarter 2018, when 418 retail establishments were reported and employment was 2,132.
These numbers are less than the number of approved business licenses for dispensaries at the time. The Oklahoma Medical Marijuana Authority had already approved more than 1,200 dispensary by the end of March.
There are several reasons that could contribute to the employment numbers not matching the approved business licenses filed.
“There obviously have been a lot of these businesses that have been formed,” said Lynn Gray, Oklahoma Employment Security Commission director of economic research and analysis. “I’m guessing a lot of these new businesses, as of March, didn’t have new employees they needed to report.”
Businesses filed as partnerships are exempt from reporting each partner as an employee, Gray said. Many medical marijuana businesses are founded under partnerships or limited liability companies.
Spouses or parents are also exempt from being listed as employees.
Also, a business owner may have been approved by March, but had yet to open or hire any employees.
Finally, there is always the possibility of companies not filing in a timely manner.
“I guess you would have a few companies who formed and didn’t get their paperwork filed and in to us on time,” Gray said. “Just like filing any other tax forms you’ll have some individuals who don’t do it on a timely basis.”
The next set of data will be available in about three months.
An article published September 6 incorrectly listed the percent change for sales tax revenues from medical marijuana in Oklahoma. Sales tax collections grew 13% from July to August, a change from 15% and 31% in the two months prior.