JUNEAU — A Fairbanks lawmaker is pushing to overhaul Alaska’s marijuana tax structure, as cultivators and retailers say the current structure is an “existential threat” to their business.
HB 91 would phase out the existing $50 per ounce tax levied on cultivators to replace it with a 6% sales tax paid by consumers, modeled after the “sin tax” in place for alcohol and cigarettes.
The bill’s sponsor, Fairbanks Democratic Rep. Ashley Carrick, argued that the flat per-ounce tax puts Alaska growers at a structural disadvantage, especially as retail prices fall and illegal sellers undercut licensed businesses.
Alaska has among the highest cultivation tax rates in the nation for marijuana.
“We believe these challenges are threats existential to Alaska’s regulated cannabis industry, and without tax relief, the regulated market will continue to get replaced by the unregulated, illicit market,” Lacy Wilcox, vice president of the Alaska Marijuana Industry Association, told lawmakers during a hearing in February 2025.
Anchorage Democratic Sen. Matt Claman is sponsoring a separate bill that cuts the current excise tax from $50 per ounce to $12 per ounce, without introducing a sales tax.
Under current state law, marijuana is taxed at the cultivation stage, not at the point of sale. Growers pay $50 per ounce of bud, $25 per ounce of immature bud, and $15 per ounce of trim. The tax is due whether or not the product ultimately sells in retail stores.
Beginning in July 2026, under Carrick’s bill, the excise tax would drop from $50 per ounce to $12.50 per ounce. Eventually, the excise tax would be repealed entirely and replaced with a 6% sales tax.
