On July 1, 2021, the state sales tax will be reduced even more
The New Jersey sales tax on medical marijuana will be cut to 4% on July 1, down from 6.625%, the first step in a three-year plan to phase out state taxes on medicinal cannabis purchases.
On July 1, 2021, the state sales tax will be reduced even more — to 2%. In 2022, it will be completely erased.
That doesn’t mean medical weed will be completely tax-free: Municipalities are still permitted to levy a 2% “transfer tax” on purchases within their borders, though no town has instituted such a tax yet.
The sales tax phaseout was a key part of last year’s Jake Honig Compassionate Use Medical Cannabis Act, which also legalized medical marijuana edibles, raised the monthly allowance to 3 ounces per patient and required them to re-certify just once a year.
The law was named after Jake Honig, a 7-year-old from Howell for whom medical marijuana provided the only relief from an inoperable brain tumor. Honig died in 2018.
Activists have decried the policy of instituting any tax on medical marijuana purchases as “criminal,” since over-the-counter and prescription medicines at traditional pharmacies are exempt from New Jersey sales tax.
“How dare we use the term ‘medical’ and charge poor people and working people and families sales tax on something that helps them feel better,” Sen. Robert Singer, R-Ocean, said last year when the bill was up for a vote. He voted for the bill.
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