Letter to the Editor: Marijuana surtax will hurt local business

Hello Mayor and Council Members,

I have a retail marijuana store opening this coming year. I’m concerned the taxing of legal marijuana sales too high at the local level will have a negative effect on this new small business.

Costly regulations, fees and taxes

In addition to the extremely high taxes on every level of government, marijuana establishments have costly state regulations. These costs reflect in the pricing of product in licensed shops. Unlicensed marijuana growing and selling do not have the fees and/or taxes being paid to the federal, state, or local level.

  • Testing, labeling costs, and special packaging requirements.
  • Extensive security plan and requirements are required for every licensee.
  • The state requires every licensee to use the same marijuana tracking software. This tracks everything from seed to sale. Cultivation, waste disposal, transportation between licensees, and sales on a daily basis.
  • Marijuana licenses ($5,000/year) are four times higher than alcohol licenses from the Alcohol & Marijuana Control Office (AMCO).
  • The state of Alaska collects one of if not the highest tax on marijuana in the county.

Local marijuana tax 12+%

Section 5.40.010 — surtax levied. This tax section adds additional 6% tax to the already high sales tax. Putting an addition tax on a business that has not opened yet is putting the cart in front of the horse.

  • 12% tax for purchasing marijuana products would make us the highest in the state.
  • Alaska doesn’t have a regulated Medical Marijuana Industry so any Alaska Medical Marijuana Card Holders will be required to pay the same tax rate as anyone else.
  • This product has been forced to be in the black market for far too long. In 2014 Alaskans voted to change that. Regulation and taxation should not be over burden to a business, especially one that its competition is unregulated and untaxed.

There has been no legal marijuana sales in Cordova as of yet. Removing marijuana from the surtax you will not but losing any projected tax collection. Please make an amendment to the ordinance 1178 and remove marijuana from the surtax.

Melina Meyer
Owner, The New Company Store

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