830 CMR 64N.1.1 sets forth the rules for the imposition of the marijuana retail taxes on the retail sale of marijuana.

(3) Marijuana Retail Taxes

Retail sales of marijuana are subject to as many as three taxes: the marijuana excise, the marijuana local tax option, and the sales tax.  This section explains the general applicability and rules governing the imposition of each tax.

(a)    Marijuana Excise.  In general, all sales of marijuana by a marijuana retailer are retail sales subject to the marijuana excise.  However, the following sales of marijuana are not subject to the marijuana excise.

1.    Sales to a Marijuana Establishment.  The marijuana excise does not apply to the sale of marijuana by a marijuana retailer to another marijuana establishment.  To qualify for this exclusion, a marijuana establishment purchasing marijuana from a marijuana retailer must present its marijuana establishment license to the marijuana retailer demonstrating that it is a marijuana establishment at the time of sale.

2.    Sales of Medical Marijuana.  Sales of medical marijuana are exempt from the marijuana excise.  A purchaser must present his medical registration card, also known as a Medical Use of Marijuana Program ID Card, as defined in 935 CMR 500.002, together with a valid government-issued identification card at the time of sale in order to qualify for the exemption.  A marijuana retailer must verify at the time of sale that a purchaser is certified and registered with the applicable state agency, including the Department of Public Health or the Cannabis Control Commission.

(b)    Marijuana Local Tax Option.  In general, all retail sales of marijuana by a marijuana retailer operating in a city or town that has accepted the marijuana local tax option are subject to the marijuana local tax option.  The marijuana local tax option is imposed in the same manner as the marijuana excise.  Thus, marijuana is not subject to the marijuana local tax option when sold to another marijuana establishment or when sold as medical marijuana as described in 830 CMR 64N.1.1(3)(a).  For the purpose of determining the application of the marijuana local tax option, marijuana retailers must source all retail sales of marijuana to the marijuana retailer’s host community, as defined in M.G.L. c. 94G, § 1.    
(c)    Sales Tax.  All sales of marijuana by a marijuana establishment, regardless of whether it is a marijuana retailer, are presumed to be retail sales subject to sales tax.  However, sales between marijuana establishments may qualify as sales for resale or as exempt sales not subject to tax as explained in this section.

1.    Sales for Resale.  A marijuana establishment selling marijuana to another marijuana establishment bears the burden of proving that a sale is a sale for resale, unless it takes a resale certificate (Form ST-4) from the purchasing marijuana establishment in compliance with the good faith requirements outlined in M.G.L. c. 64H, § 8(b) and 830 CMR 64H.8.1.  A marijuana establishment may not accept in good faith a resale certificate presented by anyone other than a marijuana establishment.

2.    Sales Exempt from Sales Tax.  In general, sales of marijuana may be exempt from sales tax pursuant to M.G.L. c. 64H, § 6 only when the sale meets one of the exemptions described below.  

a.    Medical Marijuana.  Sales of medical marijuana to a qualifying patient or the patient’s personal caregiver that satisfy the requirements of 830 CMR 64N.1.1(3)(a)(2) are exempt from sales tax as prescription medication pursuant to M.G.L. c. 64H, § 6(l).    

Marijuana establishments must collect sales tax on all transactions except as described in this section.   Marijuana establishments may be entitled to additional sales tax exemptions not specified above for purchases of non-marijuana tangible personal property that are used for one of the exempt purposes described in M.G.L. c. 64H, § 6.