CARSON CITY — It’s going to take some money – about half a million dollars – to start making money from Nevada’s forthcoming medical marijuana dispensary program.
The Nevada Department of Taxation is seeking $529,000 from a special legislative fund to cover the cost of collecting a new tax on the sale of medicinal marijuana.
A dispensary law passed in the 2013 legislative session and sales will begin next year.
The request will be considered by the state Board of Examiners on Tuesday, and then go to the Legislature’s Interim Finance Committee on Aug. 29.
Supporters of the bill were concerned that the cost to implement the tax collection process could have led to a veto by Gov. Brian Sandoval, but he signed the bill into law.
Sen. Tick Segerblom, D-Las Vegas, who authored the bill, has said the state stands to bring in a considerable amount of revenue from the 2 percent excise tax on both the wholesale and retail sale of medicinal marijuana and related products that will be collected by the Tax Department. Buyers will also pay sales tax on their purchases.
Segerblom said he does not know precisely how much revenue will come to the state from the sales, but additional fees will be collected from the $70 medical marijuana cards. There are about 3,500 Nevadans with cards now, and that is expected to grow with the new dispensary system, he said.
Another 7,000 cards would generate $490,000, almost covering the cost of the Tax Department request, he said.
Details of the funding request provided by the tax department show that the agency will need to hire a new tax examiner at a cost of $52,370 a year and make programming changes to its tax system at a one-time cost of $496,000 to begin collecting the new revenue.
Three-quarters of the revenue collected from the excise tax will be deposited in the state school fund, while 25 percent will pay for the costs of the program operated by the Nevada Division of Public and Behavioral Health.
The agency has until April 1 to craft regulations to allow for the creation of up to 40 medical marijuana dispensaries in Clark County and smaller numbers in other counties.
Contact Capital Bureau reporter Sean Whaley at email@example.com or 775-687-3900.