A recent Missouri Court of Appeals ruling will reduce taxes on marijuana products in St. Louis County, following a decision that prohibits local governments from layering additional cannabis taxes on top of one another.
The ruling clarifies that while local governments can impose a 3% cannabis tax, the state constitution prevents cities and counties from stacking those local taxes. Under the law, a locality cannot impose multiple local taxes on the same product.
According to the Missouri Independent, 90 of Missouri’s 114 counties have added a 3% local cannabis tax on top of the state’s 14.98% sales tax. However, in 74 of those counties, individual cities or towns have also levied their own 3% tax on top of the county tax. This practice was at the center of the legal challenge, with the appeals court declaring it unconstitutional.
The case hinged on the interpretation of the word “and” in the state constitution, specifically whether a county’s cannabis tax applied to both incorporated and unincorporated areas. The court’s decision overturned a lower-court ruling in a case brought by Robust Missouri 3, an adult-use marijuana store in St. Louis County, which contested the dual-taxation system. St. Charles County also opposed the challenge in court.
The ruling, which could reduce taxes by approximately $3 million per month for consumers, gives counties 30 days to file an appeal. St. Louis County officials said they are reviewing the decision and considering their next steps.
