×

Cannabis Businesses Given Option To Pay Taxes Annually

Pending Gov. Kathy Hochul’s approval, state lawmakers want to give cannabis distributors to pay their taxes once a year rather than every quarter.

Legislation passed in both the Senate and Assembly (A.10196/S.9359) in the closing days of the 2024 legislative session. Assemblywoman Donna Lupardo, D-Binghamton, wrote in her legislative justification that paying taxes quarterly puts cannabis businesses in the position of owing taxes before they actually sell the product. Alcohol excise taxes are often also paid annually rather than quarterly.

“The slow opening of cannabis dispensaries, due to multiple factors, has created a backlog of products on processors shelves, which have yet to be sent or sold to retailers, yet the tax is still owed,” Lupardo wrote in her legislative justification. “Another factor creating stress on the processor’s ability to pay the excise tax, is that some retail dispensaries are delinquent in paying for products they have received . There is a prompt payment provision in the cannabis law, but, due to many factors the provision is not being enforced. By allowing the tax to be collected annually it will allow flexibility in the market as it matures and provides a financial lifeline to currently struggling producers and processors.”

Assemblyman Andy Goodell, R-Jamestown, argued against the change on the Assembly floor. Assemblyman Joe Giglio, R-Gowanda, joined Goodell and 25 other Assembly members who voted against the tax change for cannabis businesses. The bill will be sent to Gov. Kathy Hochul for her approval or veto.

“You wouldn’t know it from the title, but what this bill does is allow distributors of cannabis products to pay their taxes at the end of the year rather than pay them quarterly like every other business,” Goodell said. “In fact, most other lawful businesses, I guess it’s a lawful business, most other lawful businesses pay monthly and sometimes even have to pay when they buy the product and not when they sell the product. So maybe it seems that we ought to treat those who sell cannabis in the same way that we treat all the other private businesses on the same basis, so that’s why I’m opposing this.”

Newsletter

Today's breaking news and more in your inbox

I'm interested in (please check all that apply)
Are you a paying subscriber to the newspaper? *
   

Starting at $2.99/week.

Subscribe Today