New Mexico court allows medical marijuana tax deduction
SANTA FE, N.M. (AP) — Medical marijuana producers in New Mexico can claim a tax deduction for prescription medication, a move that could affect prices for thousands of enrolled patients, according to a state Court of Appeals ruling.
The 11-page ruling means lawmakers must soon set aside funding to cover the tax claims, which could carry a multimillion-dollar price tag for the state Taxation and Revenue Department, Albuquerque Journal reported.
The agency has reviewed the ruling and is weighing legal options, tax department officials said. The department has until Feb. 27 to appeal the ruling.
Medical marijuana providers paid about $24 million in gross receipt taxes during a recent almost three-year period, officials said. Those taxes are paid by providers but usually passed on to patients, who could see a drop in prices for medical cannabis products because of the ruling, department officials said.
Tax claims could range from several hundred thousand dollars to several million dollars depending on the producer, officials said.
In the ruling, the Court of Appeals has determined medical marijuana meets the definition of a prescription drug under the state’s tax code, because physicians are required to certify that patients have a qualifying condition before they can enroll in the program.