Medical Marijuana Holdup: Sales Tax Question Stalls N.J. Legalization

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Like most of steps in the almost three-year-long struggle to legalize the sale of medical marijuana to chronically and seriously ill patients, the final one has turned into a stumble.

Joe Stevens, a co-founder of the Greenlead Compassion Center, the first licensed alternative treatment site, says the only obstacle in the way of opening its doors in Montclair is the state's decision on whether to impose a sales tax.

But State Health Commissioner Mary O'Dowd insists that isn't the case.

"As far as the state is concerned, there are no issues preventing Greenleaf from opening," Donna Leusner, a spokeswoman for O'Dowd, said Thursday.

State Sen. Nicholas Scutari (D-Union), one of the law's prime sponsors, said it was always his intention for the sale of medical marijuana to be subject to the state's 7 percent sales tax even though there's no mention of it in the legislation.

"I think they have to have an answer," Scutari said.

O'Dowd said last Friday the department notified Greenleaf its marijuana had passed a battery of tests, and that some nonessential lab work would probably be completed the following week.

"We are actively working to establish an opening date," Stevens said Thursday.

But first, he said, a sales tax was the "one outstanding, important issue."

He said the Health Department "has been communicating with the Treasury Department to get a definitive answer, but we must have this answer before we can begin dispensing."

Leusner disagreed, however.

"A review of the tax issue is not a barrier to opening," she said. "Its resolution at a later date would not result in any penalty for Greenleaf."

The Treasury Department, which would collect the tax, did not respond to numerous requests for comment Thursday.

The program has been the source of friction between the Legislature and Gov. Chris Christie, who described the law as too permissive, and advocates have criticized the administration for moving too slowly.

The Christie administration issued a permit to Greenleaf – one of five planned dispensaries – on Oct. 18 to begin selling the marijuana to pre-approved patients. But first the substance had to pass Health Department's tests on everything from pesticides to a requirement that the potency level of the THC – the active hallucinogenic chemical – not exceed 10 percent.

As of Wednesday, 285 patients were enrolled, according to John O'Brien, a retired state trooper who is overseeing the program.

Stevens said Greenleaf would notify patients to make an appointment when the center was ready to open "as soon as the tax issue is resolved."

"We don't want to schedule appointments and then have to postpone in the event this issue isn't settled," he said.

Of the 18 other states, and the District of Columbia, that have approved medical marijuana sales, not all have programs up and running or sales tax plans in place. A study by the state Treasury Department in Vermont – which has four dispensaries – reported California was on track to collect at least $58 million in sales tax in 2012, and that Colorado collected $5 million last year.

O'Dowd said that when Greenleaf opens its doors, patients will be assured the drug they buy is free from mold, fungus, pesticides.

She said the Health Department also created a testing protocol that measured the potency of the eight active ingredients, called cannabinoids.

"This gives us, in our opinion, the most effective data out there ... that will allow for scientific research, and decision-making by physicians and patients," she said.

So far, she said, only 35 percent of the 216 doctors registered with the program have referred patients.

"I think they would like to provide palliative options to their patients, but they are concerned about what is in the product," she said. "I think this type of information will provide a level of comfort."

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Source: nj.com
Author: Susan Livio
Contact: Contact Us - NJ.com
Website: Medical marijuana holdup: Sales tax question stalls N.J. legalization | NJ.com
 
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