Cannabis Taxes Could Reach 41% In Chicago

Tax rates on adult-use cannabis in Chicago could reach as high as 41 percent for high-potency products after local regulators approved an extra 3 percent tax on all cannabis retailers.

Full story after the jump.

Cannabis taxes in Chicago, Illinois could be as high as 41 percent by the summer after the Cook County Board of Commissioners approved a 3 percent tax on cannabis retailers on Thursday, the Chicago Sun-Times reports. Dubbed the Cannabis Retailers’ Occupation Tax, the tax will be imposed on “all persons engaged in the business of selling cannabis,” except for medical-only dispensaries.

Chicago has already planned a 3 percent tax on sales and state taxes run from 10 percent to 25 percent depending on potency; and all cannabis products carry normal sales tax, which in Chicago is 10.25 percent. Once the new 3 percent tax – the highest county tax allowed under the state law – is considered, the tax rate for products with the higher rates of THC will be 41.25 percent.

Commissioner Larry Suffredin (D) said the tax is warranted because legalization will lead to increased health and policing costs.

“This is a reasonable taxation to protect our citizens from further taxation necessary to cover both the medical cost of the program and the court cost.” – Suffredin, to the Sun-Times

County Chief Financial Officer Ammar Rizki estimates that the county would raise about $850,000 annually from the tax, which would be deposited into the county’s public safety and general funds.

The board’s Legislation and Intergovernmental Relations Committee also approved an ordinance to create a cannabis commission to study legalization’s impact on the county; while the Zoning and Building Committee passed a zoning ordinance governing cannabusinesses that open in unincorporated Cook.

The commission is expected to approve those measures.

Get daily news insights in your inbox. Subscribe

End


From Our Partners