Adult Use Marijuana
Proposition 207, the Safe and Smart Act, passed into law in November 2020 and legalized marijuana for adult personal use. The statutory provision Prop 207 is found in Arizona Revised Statutes (A.R.S.) Title 36, Chapter 28.2. This voter initiative allows adults over the age of 21 to possess, purchase, transport, or process 1 ounce or less of marijuana or 5 grams or less of marijuana concentrate. The Arizona Department of Health Services (ADHS) is responsible for licensing and regulating marijuana, marijuana retail sales, marijuana growth, and testing facilities in Arizona. The Arizona Department of Revenue (ADOR) is tasked in A.R.S. Title 42, Chapter 5, Article 10 with collecting the excise tax (imposed only by the state) and transaction privilege tax (state, counties, and cities) imposed on adult use marijuana sales.
Licensing and Registration
If your business sells marijuana or marijuana products (see definitions), you will need a transaction privilege tax (TPT) license and a Marijuana Excise Tax (MET) registration number. Proof of licensing with ADHS will be required in order to obtain a MET registration number. Registration for MET cannot be done online. In addition, if you are already licensed for medical marijuana, you must apply to convert your TPT license to reflect the new business activity or if applicable, you must also register as an adult use marijuana retail establishment to report the retail TPT and excise tax.
You will need to complete the paper registration form, Medical, Adult Use or Dual License Transaction Privilege/Use/Excise Tax Application (JTM-1) to get your MET registration number to obtain your TPT license. Form JTM-1 is used to apply for the transaction privilege tax and use tax as well as the MET registration number. It can also be used to register for Employer Withholding and Unemployment Insurance. Registration can not be done online; it must be done by paper. TPT licenses are valid for a calendar year and must be renewed annually.
Do I need a Transaction Privilege Tax (TPT) license or Marijuana Excise Tax (MET) license?
| Vendor Type |
Adult-Use Marijuana License from the Arizona Department of Health Services (ADHS)? |
TPT License | MET License | Update to current TPT license? |
|---|---|---|---|---|
| Grow or Cultivate Marijuana | Yes | No | No | N/A |
| Wholesaler of Marijuana | Yes | Yes | No | No |
| Manufacturer of Marijuana Oils and Ointments | Yes | Yes | No | No |
| Manufacturer of Candy Infused with THC | Yes | Yes | No | No |
| Retailer of Adult Use Marijuana | Yes | Yes | Yes | Yes |
| Retailer of Marijuana Edibles | Yes | Yes | Yes | Yes |
| Retailer of Marijuana Products (Oils, Ointments, etc.) | Yes | Yes | Yes | Yes |
| Retailer of Grow Items Only (e.g. lights, jars, etc.) | No | Yes | No | No |
| Retailer of Pipes and Accessories Only | No | Yes | No | No |
| Retailer of Medical Marijuana | Yes | Yes | No | Yes |
|
Industrial Hemp Products - See FAQs |
No | Yes | No | No |