OMMPOS Blog - Tax

OAR 845-025-1190 (Effective 08/13/2024)

This rule outlines the requirements marijuana retailers must follow to obtain an extension for tax compliance.

Since the OLCC was directed in 2023 to take steps to require proof of tax compliance for marijuana retailers, the agency has encountered situations where licensees have extenuating circumstances that prevent them from timely obtaining certificates of tax compliance. The amendments outline the process and criteria OLCC requires to grant a licensee’s request for a temporary extension.

This action makes the temporary amendments permanent, with some minor changes to refine the rule language. Effective 08/13/2024.

For more information on OLCC Rulemaking:

OLCC.rulemaking@oregon.gov

www.oregon.gov/olcc/Pages/Laws_and_Rules.aspx

• Public Notice of Proposed Rulemaking

In 2023, the Oregon Liquor and Cannabis Commission (OLCC) and Department of Revenue (DOR) were directed by Governor Kotek to take steps to require proof of tax compliance for marijuana retailers as part of the renewal, change of ownership, addition of license holders, and/or new licensure process. Since that time, the OLCC has encountered a subset of licensees that have extenuating circumstances preventing them from obtaining certificates of tax compliance within the timeframes currently allowed in rule. Licensees may be facing deaths in the family, pending legal actions, or other technical/paperwork delays beyond their control, but are otherwise able to demonstrate an acceptable level of tax compliance.

In response to these situations, the OLCC passed a temporary rule to grant relief only in specific situations where the licensee is in compliance with marijuana taxes and diligently trying to obtain a certificate of compliance while working through other tax issues. These amendments temporarily provided the OLCC flexibility to allow additional time that will prevent the unnecessary closing of an otherwise compliant businesses. A licensee applying for an extension would need to meet specific requirements and provide proof that they are working to obtain their certificate of compliance. The OLCC is not anticipating granting such extensions frequently and intends to continue requiring strict compliance in most cases, but needs the flexibility to allow for case-by-case circumstances, given that the process creates unique situations for individual licensees. This rulemaking makes the temporary rules permanent, with some minor changes.

May 21, 2024
10:00 am – 12:00 pm
*Meeting Held Virtually*

In May 2023, Governor Kotek directed the OLCC and DOR to immediately take steps to require proof of tax compliance for marijuana retailers as part of the renewal, change of ownership, addition of license holders, and/or new licensure process. Requiring proof of tax compliance before such licensing actions may be approved will ensure only those up to date on tax obligations or making timely payments under a Department of Revenue-approved payment plan, will be permitted to operate in the cannabis industry.

Certificates of tax compliance are required from every licensee of a Retailer license as part of renewal requirements. A Retailer may file for renewal and be granted temporary authority to operated past their expiration date for up to 90 days after their expiration date, but their renewal will be considered incomplete and the license to be expired if the Commission has not received all required documentation by that time. This action would permanently adopt the temporary rule filed June 16, 2023 (OLCC 4-2023), allowing the Commission to consider and grant additional extensions of this timeframe when certain conditions are met.

• AGENDA 
• DRAFT RULE LANGUAGE

The Q1 2024 tax return is available for download. Please go to reports, click the Q1 return link and then upload your return to Revenue Online. 

JUSTIFICATION OF TEMPORARY FILING:
(1) The Oregon Liquor and Cannabis Commission is planning to adopt a temporary rule to require applicants for new
and renewal cannabis retail licenses to provide a certificate of tax compliance to the commission pursuant to the May
16th, 2023 Governor’s Directive to OLCC related to the regulation of cannabis retailers and state tax compliance for
new or renewed cannabis retail licenses. Certificates of tax compliance will also be required for changes of ownership
and certain changes in business structures. If the Department of Revenue does not promptly amend the rule to include
the provisions regarding obtaining a certificate of tax compliance, applicants will be seriously prejudiced by having no
guidance on the process or the circumstances under which the department will approve or deny a request for a tax
compliance certificate. There are also other state programs that require a certificate of tax compliance, and the
department needs to provide guidance on the tax certification process and criteria for those programs as well. In
addition, the rule amendment is needed to clarify the process for a taxpayer to provide a self-certification regarding
their tax compliance under the Public Contracting Code and ORS 305.385.
(2) Cannabis retailers, along with other program applicants required to obtain a certificate of tax compliance, will suffer
if they are unable to operate due to their inability to obtain a tax compliance certificate through failure to understand
the process or criteria for obtaining the certificate.
(3) If the department fails to amend the rule, cannabis retailers would be required to seek a certification of tax
compliance, pursuant to OLCC requirements, but would not have a clearly laid out process and guidance on how they
can qualify as being in tax compliance.
(4) The proposed rule amendment will provide clear guidelines to applicants on how and when the department will issue
a tax compliance certificate and when the department will not certify tax compliance.

See Full Text

File your quarterly return in minutes.

Fill out your Marijuana Tax Voucher faster than ever with our new OMMPOS Marijuana Tax Voucher report.

We received an official response from the Oregon Department of Revenue regarding the Marijuana Taxation issue and the OMMPOS METRC Sales Reconciliation tool. First a quick timeline.

• OMMPOS was the first Oregon company to begin reporting to METRC in 2016.
• OMMPOS reported GROSS sales values to METRC and NET sales values through our Instant Tax E-file tool from Q2 2016 - Q1 2019.
• In May 2019 we received reports that stores were being taxed at a higher tax rate than they should have been.
• We create the METRC Sales Reconciliation Tool to enable retailers to correct their METRC sales receipts to match their OMMPOS sales receipts.

Yesterday the Oregon Department of Revenue responded to us to let us know that they have been receiving a lot of phone calls with questions about this issue. They wanted us to let you know that

• No customers of OMMPOS or any other point of sales system are being taxed at a higher rate than what their sales records indicate. We rely on taxpayers to correctly report their sales information and are grateful for your continued partnership in that goal
• When we identify a deficiency in the course of an audit we do not necessarily know which point of sales system the retailer is using (and some retailers switch point of sales systems in the course of their business).  In the course of several audits within the past year we identified that the sales figures getting reported to OLCC from some retailers did not match the sales figures reported on returns. When retailers provided point of sales records detailing actual sales that corresponded to their returns, we reversed deficiencies.

Please give us a call with any questions. Thank you!

Raja Afrika
Marijuana Software
(971) 276 - 3371

OMMPOS customers who signed up in 2016, 2017 & 2018 may have paid too much tax.

ISSUE: When OMMPOS first began reporting sales numbers to METRC we reported GROSS sales values, this includes the tax.

The Oregon Department of Revenue may have taxed these stores on their GROSS receipts; in effect a double tax.

Use the new METRC Sales Reconciliation tool to check your OMMPOS and METRC sales figures and make sure they match. Learn more...

Use the new OMMPOS.COM METRC Sales Reconciliation Tool to detect potential Marijuana Tax overpayments.

Rapidly compare sales totals between OMMPOS Point of Sale and METRC to ensure that you were billed the correct amount by the department of revenue.

Upload your quaterly taxes with just a few clicks. Our 2018 3rd quarter e-file is now available under REPORTS.

The DOR Q2 quarterly return report is now avaiabe on the reports page. Your Q2 2018 Quarterly Return payment is due before July 31st.  For more information on tax payments and due dates click here.