ADOR Reminds Adult Use Marijuana Businesses to File Their Retail Sales on April 20 Using Business Code 420
Adult use marijuana businesses are responsible for collecting and paying both transaction privilege tax (TPT) and marijuana excise tax (MET) to the Arizona Department of Revenue (ADOR).
Once licensed by the Arizona Department of Health Services, businesses are liable for retail TPT and MET on adult use marijuana products sold to consumers.
If an establishment has not registered yet, it must obtain an ADOR TPT license and a MET registration number by submitting the Medical, Adult Use or Dual License Transaction Privilege/Use/Excise Tax Application (JTM-1). Failure to use the JTM-1 may result in improper registration and require further corrective action by the business.
Upon successful registration, businesses must file and remit tax liability monthly online at www.AZTaxes.gov.
The deadlines for March activity are as follows:
Tuesday, April 20: TPT return statutory due date
Thursday, April 29: Electronic payment must be received before 5 p.m. on the day before the last business day (April 30).
Friday, April 30: Electronic returns must be received through AZTaxes before 5 p.m. on the last business day of the month (April 30).
Remember, to avoid non-filer notices and penalty assessments, filers must file a return by its due date, even if there is no tax due for the filing period.
Reporting Marijuana Excise Tax
Businesses should file their marijuana excise tax (Form MET-1) before completing the TPT return. Businesses can now report and pay their MET electronically through www.AZTaxes.gov.
Reporting TPT Sales
The TPT return is used to report and pay state/county and city TPT liabilities on all of their retail sales, including the sale of medical/adult use marijuana and anything else sold by the business.
Medical and adult use marijuana businesses should use the following business codes (BC) to file correctly:
- Retail (BC 017) - Retail sales of non-marijuana tangible personal property (e.g., pipes and glassware, rolling papers, jars, grow lights, etc.).
- Retail Medical (BC 203) - Retail sales of medical marijuana (flower/leaf, edibles, etc.). A business should only use BC 203 to report sales of medical marijuana sold to qualified patients with current registry identification cards.
- Retail Adult Use (BC 420) - Retail sales of adult use marijuana and marijuana products (21+ years) (flower, edibles, etc.).
- Use Tax (BC 029) - Items purchased from an out-of-state vendor on which no Arizona TPT is collected for use by the business rather than for resale.
- Use Tax (BC 030) – Cost/value of items used from inventory (free product giveaways, testing, etc.) originally intended for resale. This code applies to wholesalers or retailers (not both) that take items out of their inventory for use, i.e. inventory for giveaways.
For more information on filing requirements, visit https://azdor.gov/transaction-privilege-tax/adult-use-marijuana/filing-requirements.
Tuesday, April 20, 2021