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With recreational cannabis taxes in Oregon about to fall to 17% from the current 25%, the Portland City Council has asked voters to approve Measure 26-180, a 3% municipal tax on all recreational marijuana sales. Like the current state tax, this will not apply to purchasers holding a Oregon Medical Marijuana Program (OMMP) card.

Though no public polling data is available for the measure, its passage seems to be all but guaranteed. With Marijuana prices for recreational consumers set to fall regardless of whether the measure passes or fails, there has been no organized opposition to the measure. Under the current tax regime, an eighth of recreational cannabis selling for $40.00 has an after-tax sticker price of $50. After January 1, 2017, that post-tax price will fall to $46.80 if the measure fails or $48.00 should the measure succeed. Regardless of the measure’s outcome, the rate at which marijuana is taxed in Portland will remain below the rate of taxation in either Washington or Colorado.

Funds from the proposed tax are earmarked to support addiction services, public safety, and the economic development of communities disproportionately negatively impacted by marijuana prohibition in the past. This provision earned Measure 26-180 the endorsement of Jesce Horton, co-founder of Panacea, a Northeast Portland dispensary, and Chairman of the Minority Cannabis Business Association. In his statement supporting the measure in the Oregon voter’s pamphlet, Horton points to economic development provisions, highlighting the opportunity to be “the first city in the nation that will dedicate funds from recreational marijuana sales towards correcting past inequities in the criminal justice system.”

Importantly, however, it is far from clear how taxes from this measure will be spent. Though the measure targets improvements in public safety and economic development, those goals are defined very broadly. Provisions allowing funds from the tax to support the economic development of communities hit the hardest by cannabis prohibition may or may not be allocated by the City Council, which will enjoy some discretion with regards to how the revenue is spent. Supporters drawn to the social justice advocacy implied by the economic development provisions may find the revenues used for drug and alcohol health services, road safety improvements, or increased training for police on marijuana related DUI enforcement.

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