HAVRE, Mont. (NMB) – The Hill County Commission has placed an item on the agenda of their Thursday business meeting that states there will be a vote on a resolution regarding a tax on marijuana sales.
When asked by New Media Broadcasters on Tuesday morning, Hill County Commissioner Jake Strissel said it was his belief that because Hill County voters approved the legalization of recreational marijuana, the Commission could impose a tax with a vote of their Board.
When told that state law requires an election to impose this tax, Strissel said he would look into the issue and provide a response when he has one.
Late Tuesday afternoon, Commission Chair Diane McLean said they had “run into snags” and were still figuring out whether an election would be needed to implement a tax, adding that the issue may be tabled on Thursday to allow for discussions to continue in the future.
According to House Bill 701, which set the parameters for the implementation of marijuana legalization, Counties in which voters approved the sale of recreational marijuana can implement a local option excise tax of up to three percent, but it must also be approved by voters.
Counties can also charge the local-option tax for medicinal sales with separate voter approval.
This is in addition to the 20 percent tax from the state on recreational sales and four percent tax on medicinal sales.
HB 701 states* that an election must be held and the tax cannot be implemented until 90 days after the vote is held. The County must provide public notice of the election and cannot put the issue on a ballot more than once per fiscal year.
According to the Department of Revenue, in counties where a local option excise tax is implemented, 50 percent of revenue must be retained by the county, 45 percent “must be appropriated to the municipalities on the basis of the ratio of the population of the city or town to the total county population,” and the remaining five percent is retained by the DOR to “defray cost associated with administering” the tax.
Counties have broad discretion when it comes to how they can use the tax revenue, as HB 701 says, “Unless otherwise restricted, a county or municipality may appropriate and expend revenue derived from a local-option marijuana excise tax for any activity, undertaking, or administrative service that the municipality is authorized by law to perform, including costs resulting from the imposition of the tax or due to administrative burdens imposed on the municipality as a result of licensing or regulatory requirements imposed in this chapter.”
*The language in the bill regarding local options taxes can be found on pages 138 to 141 of HB 701