Arizona
General
Jun 2022
3 min

Arizona Cannabis Sales Tax

6% - 16%

Depending on medical or recreational

Answer

Medical marijuana businesses are required to pay all state and local taxes.  Medical-marijuana sales are subject to the state's

  • 5.6%
  • city and county taxes that range from 0.25% to 4%
  • 16% [additional for recreational]

Why is this important?

Knowing the tax rate allows dispensary owners to plan financially. The tax rate can impact what the best pricing is for products and can also impact financial projections.  Fortunately, Arizona's sales tax rate at the retail marijuana store level is not as exorbitant as many other states.  Many other states add excise taxes onto marijuana sales which then eats even further into profit margins.

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Regulatory Citations for This Article

Prop 203

Sec. 4. Section 43-1201, Arizona Revised Statutes, is amended to read:

B. NONPROFIT MEDICAL MARIJUANA DISPENSARIES UNDER TITLE 36, CHAPTER 28.1, ARE EXEMPT FROM THE TAXES IMPOSED UNDER THIS TITLE.

Senate Bill 1494

36-2806. Registered nonprofit medical marijuana dispensaries; requirements; rules; inspections; testing

A. A registered nonprofit medical marijuana dispensary shall be 45 operated on a not-for-profit basis. The bylaws of a registered nonprofit medical marijuana dispensary shall contain such provisions relative to the  disposition of revenues and receipts to establish and maintain its nonprofit character. A registered nonprofit medical marijuana dispensary  need not be recognized as tax-exempt by the internal revenue service and  is not required to incorporate pursuant to title 10, chapter 19,  article 1.