We are passing along this message from he Washington State Liquor and Cannabis Board Public Health Education Liaison offering clarification about the House Bill 1453 Excise Tax Exemption in 2024, allowing an exemption to the 37% excise tax for patients registered in the Cannabis Authorization Database who buy DOH-compliant products.
Message from LCB
by Kristen Haley
You may have noticed an increase in ads — over the radio, on websites, and even as yard signs — promoting a nearly 50% discount on cannabis. At LCB, we’ve heard from the public health community, industry members, and the public asking if the services promoted in these ads are legitimate.
The short answer is: sort of… it depends… not always.
Allow me to clear some things up.
• The 2024 Legislature passed House Bill 1453 Excise Tax Exemption in 2024, allowing an exemption to the 37% excise tax for patients registered in the Cannabis Authorization Database who buy DOH-compliant products.
• If a patient is registered in the database, their purchases from medically endorsed cannabis retail stores are sales tax free. This means, technically, patients can get a 47% tax exemption if they buy medically compliant products at medically endorsed cannabis retail stores.
• To become a medical patient:
1. A person needs to visit a medical provider in person.
2. The patient must have a new or existing documented relationship with the provider.
3. The provider must diagnose the patient with a qualifying condition on the Washington State Department of Health’s (DOH) medically authorized list.
4. Medical cannabis patients must be registered in the medical database, which they can set up at any medical cannabis medically endorsed stores. However, these stores require specific paperwork to complete this registration.
• These steps are outlined in more detail on the DOH medical cannabis website.
• Many of the ads promoting the “47% discount” are offering virtual appointments with providers that are not licensed in Washington State and some provide an email or other electronic format, which do not meet the standards set by DOH.
In other words, patients should know that while some of these services seem convenient, they may take a person’s payment and provide a service that is not legitimate in Washington State.
Concerns Raised by Patients
While we are on the topic of deception, I want to mention that LCB has heard from patients about a different practice related to the excise tax bill implementation. Patients have expressed concerns over a potentially deceptive practice relating to retail stores increasing their prices before applying tax exemptions. Patients were told that it was based on a concern about not selling cannabis below cost of acquisition. To be clear, all sales prices are set before any taxes are added to the purchase so tax exemptions will not reduce costs below acquisition and are not a loss for retailers.
If you have any questions or learn about other concerning ads or business practices, please contact me at Kristen.Haley@lcb.wa.gov.
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