NM Supreme Court rules medical cannabis purchases are not subject to tax
SANTA FE, N.M. – The New Mexico Supreme Court determined Wednesday medical cannabis purchases should not be subject to the state’s gross receipts tax.
The court ruling comes in response to cannabis producers requesting a refund for gross receipts taxes paid on medical cannabis, claiming medical cannabis purchases should be untaxed and treated like any other prescription.
A producer in the state’s medical cannabis program first requested a refund, in 2014, for gross receipts taxes paid on medical cannabis with the claim that it should be treated like any other prescription. Another producer also requested a refund in 2018.
The New Mexico Tax and Revenue Department denied both claims but, following an appeal from each producer, the New Mexico Court of Appeals ruled in Jan. 2020 to overturn the department’s decision. The department appealed the decision and sent the case to the New Mexico Supreme Court.
Ultra Health will receive a $7.4 million – plus interest – refund for their 2018 request.