Article: Lawsuit filed against marijuana tax stacking in Missouri

5 On Your Side News reports

Tyler Hannegan says the tax levy could cost the cannabis industry as much as $36 million, but it’s the consumers who will feel the squeeze of a cost increase.

FLORISSANT, Mo. — The Missouri Department of Revenue and St. Louis County are the targets of a recent lawsuit that alleges tax levies on marijuana are violating the state constitution by allowing municipalities to double tax consumers, raising the cost of cannabis across the state.

At Feel State Dispensary in Florissant, sales have been sky-high since the Show Me State legalized recreational marijuana.

“Business has been amazing,” said Tyler Hannegan, owner of Robust Cannabis. “We’ve seen widespread customer accumulation from all the region really. Not just Missouri. It’s been phenomenal serving a lot more.”

However, the most common question they’re getting isn’t about the cannabis but a recent cost increase.

“In Florissant, there was a 3% tax that was voted upon from all the local citizens,” said Hannegan. “On top of that St. Louis Co. came in and they’re attempting to add an additional 3% unlawfully on top of that.”

That’s why Robust Cannabis owner Tyler Hannegan recently filed suit against the Missouri Department of Revenue and St. Louis County to try and stop what’s known as tax stacking.

“We just feel that it’s really encroaching on the constitutional amendment and not really living up to the standards that have been set forth that have been voted upon by the residents of Missouri,” Hannegan said.

Hannegan said the law could cost the Cannabis industry as much as $36 million in sales, but it’s the consumers who will feel the squeeze of a cost increase.

“Depending on the volume of the dispensary you’re going to see somewhere in the ballpark of $400,000 to $1 million that’s going to cost the customers per store,” Hannegan said.

Both St. Louis County and the Missouri Department of Revenue declined to comment due to pending litigation, which Hannegan hopes will be quickly clarified by a judge.

“I just think it’s a little bit of an oversight and it’s a little bit more of let’s shoot first and ask questions later,” Hannegan said. “I don’t think it was brought into very fairly for us to impose and now we have to go this route to try and defend our customers on our behalf.”

It’s worth noting that even if a judge upholds the tax levy Missouri marijuana users are still paying less than half the tax that their counterparts across the river in Illinois currently pay.

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