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Portland hopes to tax recreational marijuana

If Oregonians vote to legalize marijuana in November, the city of Portland wants to take a 10 percent cut on the deal.

The Portland City Council on Wednesday will consider an ordinance to levy a 10 percent sales tax on recreational marijuana sold in the city, should voters approve the ballot initiative.

The initiative, which appears on the ballot as Measure 91, creates state taxing authority for marijuana and bars local sales taxes; however, many municipalities are jumping in to create local taxes before the measure passes.

The City Council also will consider an alternative proposal that would tax medical marijuana as well, with a 5 percent sales tax.

Backers of the initiative contend such local taxes are not legal, so the issue could well be resolved in the courts.

The ordinance, proposed by Major Charlie Hales, notes the city has incurred “substantial costs related to the legalization of medical marijuana,” and expects more costs if recreational use of marijuana becomes legal in Oregon.

The city tax would be levied for the “sale, transfer, mixing, handling or serving of recreational marijuana and marijuana-infused products within the city.”

The city estimates that it raise from $1.7 million to $4 million a year from the sales tax. Setting up an apparatus to start taxing marijuana sales would cost an estimated $150,000 in one-time costs, plus $280,000 in annual costs.

The City Council meeting begins at 9:30 a.m., at 1221 S.W. Fourth Ave. Meetings can be viewed live on the Internet at: www.portlandoregon.gov/28258

Steve Law can reached at 503-546-5139 or stevelaw@portlandtribune.com.

Twitter: @SteveLawTrib

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