Cannabis local excise tax

AN ACT Relating to authorizing a local excise tax on cannabis; 1
and adding a new section to chapter 82.14 RCW. 2
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:3
NEW SECTION. Sec. 1. A new section is added to chapter 82.14 4
RCW to read as follows: 5
(1)(a) The legislative authority of any county may impose an 6
excise tax of up to two percent of the selling price on the retail 7
sale of cannabis concentrates, useable cannabis, and cannabis-infused 8
products. The legislative authority of the county may only impose the 9
tax by ordinance and must condition its imposition on the specific 10
authorization of a majority of the voters voting on a proposition 11
submitted at a special or general election. The ordinance and ballot 12
proposition may provide for the tax to apply for a period of up to 13
seven consecutive years. 14
(b) If a county has not imposed the excise tax under (a) of this 15
subsection before July 1, 2027, then a city within that county may 16
impose an excise tax of up to two percent of the selling price on the 17
retail sale of cannabis concentrates, useable cannabis, and cannabis-18
infused products. The legislative authority of the city may only 19
impose the tax by ordinance and must condition its imposition on the 20
specific authorization of a majority of the voters voting on a 21
S-0888.3
SENATE BILL 5650
State of Washington 69th Legislature 2025 Regular Session
By Senators Wagoner, Christian, and Holy
Read first time 02/04/25. Referred to Committee on Ways & Means.
p. 1 SB 5650
proposition submitted at a special or general election. The ordinance 1
and ballot proposition may provide for the tax to apply for a period 2
of up to seven consecutive years. 3
(c) The tax authorized in this section is in addition to any 4
other taxes authorized by law and must be collected from those 5
persons who are taxable by the state under RCW 69.50.535 upon the 6
occurrence of any taxable event within the county or city.7
(d) A county and a city within that county may not concurrently 8
impose the tax authorized in this section. 9
(2) The legislative authority of a county or city may reimpose a 10
tax under this section for one or more additional periods of up to 11
seven consecutive years. The legislative authority of the county or 12
city may only reimpose the tax by ordinance and on the prior specific 13
authorization of a majority of the voters voting on a proposition 14
submitted at a special or general election. 15
(3)(a) If the tax under this section is imposed by a county, then 16
the state treasurer must distribute 15 percent of the moneys to the 17
county in which the tax was collected. The remainder of the moneys 18
collected under this section must be distributed to the county and 19
the cities within the county where licensed cannabis retailers are 20
physically located. Each jurisdiction must receive a share of the 21
revenue distribution under this section based on the proportional 22
share of the total revenues generated in the individual jurisdiction 23
from the taxes collected under this section from licensed cannabis 24
retailers physically located in the county and the cities within the 25
county. 26
(b) If the tax under this section is imposed by a city, then the 27
state treasurer must distribute 15 percent of the moneys to the 28
county and the remainder must be distributed to the city.29
(4) The liquor and cannabis board must perform the collection of 30
taxes under this section on behalf of a county or city and the state 31
treasurer must distribute those taxes as available on a monthly basis 32
to the county and cities within the county. Before the effective date 33
of a resolution or ordinance to impose an excise tax under this 34
section, the legislative authority of the county or city must 35
contract with the liquor and cannabis board for tax administration 36
and collection. The liquor and cannabis board may deduct a percentage 37
amount, as provided by contract, not to exceed one percent of the 38
taxes collected for administration and collection expenses incurred 39
by the board. 40
p. 2 SB 5650
(5) The definitions in RCW 69.50.535 apply to this section.1
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p. 3 SB 5650