Or. Admin. R. 150-475-2100 - Marijuana Tax: Categorization of Product Types

(1) Definitions:
(a) Except as otherwise specifically defined in this rule, the definitions in ORS 475C.009 apply to the same terms as used in this rule.
(b) "Blended pre-roll" means a combination of buds and shake/trim in some sort of plain, non-infused wrapping, and which is designed for smoking.
(c) "Buds" are included within the definition of "marijuana flowers" in ORS 475C.009(24).
(d) "Capsule" means a small soluble container, usually made of gelatin that encloses a dose of a cannabinoid product, concentrate, or extract intended for human ingestion.
(e) "Combined product" means any product that combines buds and shake/trim with concentrate and/or extract, or combines concentrate with extract.
(f) "Infused pre-roll" means usable marijuana combined with one or more other marijuana items other than plain, non-infused wrapping or filter/tips, and which is designed for smoking.
(g) "Marijuana retailer" means a marijuana retailer licensed by the Oregon Liquor and Cannabis Commission, or any employee or representative of a marijuana retailer, who sells marijuana items on or after January 4, 2016.
(h) "Medical marijuana card" means a registry identification card held by either a patient or a designated primary caregiver, as described in ORS 475C.783.
(i) "Shake" and "trim" are included within the definition of "marijuana leaves" in ORS 475C.009(26).
(j) "Suppository" means a small soluble container designed to melt at body temperature within a body cavity other than the mouth, especially the rectum or vagina containing a cannabinoid product, concentrate, or extract.
(k) "Tincture" means a solution exempt from the Liquor Control Act under ORS 471.035 that combines alcohol and cannabinoid concentrate or extract. A tincture may or may not include other ingredients intended for human consumption or ingestion.
(l) "Topical" means a cannabinoid product intended to be applied to skin or hair.
(m) "Transdermal patch" means an adhesive substance applied to human skin that contains a cannabinoid product, concentrate, or extract for absorption into the bloodstream.
(2) The following classifications apply to sales in tax periods beginning on or after January 1, 2020. A marijuana retailer must charge tax on products purchased by an individual that does not present a valid medical marijuana card at the following rates:
(a) Shake/trim, buds, and blended pre-rolls are taxed at the rate in ORS 475C.674(2)(a).
(b) Seeds and immature marijuana plants are taxed at the rate in ORS 475C.674(2)(b).
(c) Edibles and tinctures are taxed at the rate in ORS 475C.674(2)(c).
(d) Concentrates are taxed at the rate in ORS 475C.674(2)(d).
(e) Extracts are taxed at the rate in ORS 475C.674(2)(e).
(f) Topicals and transdermal patches are taxed at the rate in ORS 475C.674(2)(f).
(g) Capsules, suppositories, and combined products, including infused pre-rolls, are taxed at the rate in ORS 475C.674(2)(g).
(3) If a marijuana retailer sells a marijuana item that is not listed in Section 2 of this rule, then the business must make a determination about which tax category applies to the item. In making the determination, a marijuana retailer should take into account how items with a similar method of consumption are taxed, and may request guidance from the Department of Revenue under those circumstances.

Example 1: John, a marijuana retailer, sells pre-rolls containing shake/trim wrapped in a plain paper wrapping designed for smoking. These pre-rolls will be taxed as usable marijuana under ORS 475C.674(2)(a) and reported on Schedule 1 by weight of usable marijuana included in the pre-roll.

Example 2: Joil, a marijuana retailer, sells pre-rolls containing buds wrapped in a paper wrapping, infused with a marijuana concentrate, and designed for smoking. These infused pre-rolls will be taxed as a combined marijuana item under ORS 475C.674(2)(g) and reported by units sold on Schedule 1.

Notes

Or. Admin. R. 150-475-2100
REV 69-2017, adopt filed 12/22/2017, effective 1/1/2018; REV 7-2019, amend filed 12/11/2019, effective 1/1/2020; REV 27-2022, minor correction filed 12/06/2022, effective 12/6/2022

Statutory/Other Authority: ORS 305.100 & 475C.714

Statutes/Other Implemented: ORS 475C.674

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