BILL NUMBER: S5365

SPONSOR: COONEY
 
TITLE OF BILL:

An act to repeal section 490 of the tax law relating to the excise tax
on medical cannabis; and to repeal section 89-h of the state finance law
relating to the medical cannabis trust fund

 
SUMMARY OF PROVISIONS:

Section 1 repeals section 490 of the tax law.

Section 2 repeals section 89-h of the state finance law.

Section 3 is the effective date.

 
JUSTIFICATION:

New York State currently has one of the highest tax rates on medical
cannabis in the nation. Bordering states, including Connecticut, Massa-
chusetts, New Jersey, Rhode Island, and Vermont have no excise tax on
              

medical cannabis products whatsoever. All except Rhode island have lower
total rates, including 0% total in Massachusetts and 2% in New Jersey.
This, combined with the administrative hurdles to obtaining a medical
card and the limited number of dispensaries, serve to restrict patient
access across the state, especially for economically disadvantaged New
Yorkers.

Medical cannabis has been shown to provide critical benefits to New
Yorkers. A recent DOH report found that patients receiving 30 days or
more of medical cannabis for chronic pain is associated with a reduction
in the use of prescription opioids by up to 51%. Medical cannabis is
well-known to relieve symptoms for individuals suffering from Multiple
Sclerosis and other nerve pain. Medical cannabis is also a popular tool
for individuals undergoing chemotherapy for cancer treatment.

Because the program is currently so limited due to cost and administra-
tive hurdles, state tax revenues from the program are minimal. In FY22,
the entire program generated $12.9M in tax revenue.  Medical dispensar-
ies first opened in January 2016. It is far past time to make necessary
improvements to this program for the good of patients across New York
State.

New York currently trails 27 other U.S. States in terms of medical
patient enrollment per capita, which shows that changes are necessary to
establish a robust medical cannabis program. This bill, by repealing the
7% excise tax on medical cannabis products, will ensure equitable
patient access to the products they need for health purposes.

 
LEGISLATIVE HISTORY:

This is a new bill.

 
FISCAL IMPLICATIONS:

To be determined

 
EFFECTIVE DATE:
This act shall take effect immediately