Flathead County to discuss local marijuana tax
Jul. 25—Flathead County commissioners on Wednesday will discuss the option of a local tax on marijuana sales.
House Bill 701 allows a marijuana excise tax via ballot initiative in Montana counties where a majority of voters approved legalization. Flathead voters approved recreational sales by a 7 point margin in the 2020 election.
According to the Montana Department of Revenue, the local tax is on the retail value of all marijuana and marijuana products sold at an adult-use dispensary or medical marijuana dispensary within a county. The rate is set by an election petition or resolution, and may not exceed 3%.
Flathead County Commissioners will hold a public comment session at 9 a.m. on July 27 at the courthouse on 800 S. Main St in Kalispell.
State taxes on marijuana are set at 4% for medical marijuana and 20% for adult-use sales.
As of June, the state recreational tax had generated more than $15 million in revenue, with an additional $3 million from medical marijuana sales.
Sixteen Montana counties have already created a local marijuana tax, including Lake, Missoula and Ravalli counties in western Montana.
In Lake County, the county takes 50% of the revenue, with the remainder going to Polson, Ronan and St. Ignatius, and 5% to the state as an administration fee. Lake County estimates its local governments could collectively take in $180,000 annually.
Similarly in Missoula, the county keeps half the revenue and passes along 45% to municipalities within the county.
Counties can decide how to utilize the local tax revenue.
In Park County, for example, revenues go to the sheriff's office and general fund, while Missoula County has considered using the funds to lower property taxes.
