State law dictates where Arizona can spend tax revenue from marijuana sales | Local News
The first is known as the transactional privilege tax, or TPT tax, and is similar to a sales tax. âAs the name suggests, you are basically paying a fee for the privilege of doing business and doing business,â Richard said in an interview.
The TPT tax applies to all sales of marijuana, whether recreational or medical. It is set by the state at 5.6%, but cities and counties can adjust it higher.
For example, Pima County adds an additional 0.5%, and county municipalities add an additional 2% to 4%. For example, at a Pima County dispensary, a consumer can expect to pay 6.1% to 10.6% TPT tax on a purchase.
Between the tax revenue generated by recreational ($ 25.5 million) and medical (nearly $ 37 million) sales, the state has collected more than $ 62.3 million in TPT dollars until the end of July.
The largest and most recreation-oriented tax is the excise tax, which is similar to a âsin taxâ.
The excise tax is levied exclusively on recreational purchases, not medical transactions, and is 16%. From the end of January, when the state began authorizing recreational sales, to the end of July, approximately $ 53 million in excise tax revenue was collected.
Taxpayer money from excise tax, along with licensing fees paid by dispensaries, goes into what’s called the Smart and Safe Arizona Fund. From there, dollars are separated into five categories, with each category pulling a certain percentage of funds: