Md. Code Regs. 03.06.01.47

Current through Register Vol. 51, No. 22, November 1, 2024

Section 03.06.01.47 - Cannabis

A. Scope. This regulation applies to all businesses required to be licensed or registered by the Maryland Cannabis Administration, including growers, micro growers, processors, microprocessors, incubator space operators, dispensaries, micro dispensaries, on-site consumption establishments, and delivery services.

B. Definitions.

(1) In this regulation, the following terms have the meanings indicated.

(2) Terms Defined.

(a) "Cannabis" has the meaning stated in Alcoholic Beverages and Cannabis Article, §1-101, Annotated Code of Maryland.

(b) "Delivery service" has the meaning stated in Alcoholic Beverages and Cannabis Article, §36-101, Annotated Code of Maryland.

(c) "Medical cannabis" means cannabis that is:

(i) Purchased by or administered to an individual who is registered as a qualifying patient, as defined in Alcoholic Beverages and Cannabis Article, §36-101, Annotated Code of Maryland; or

(ii) Purchased by a caregiver, as defined in Alcoholic Beverages and Cannabis Article, §36-101, Annotated Code of Maryland.

(d) "Vaping liquid" has the meaning indicated in Business Regulation Article, §16.7-101, Annotated Code of Maryland.

C. Returns and Record Keeping.

(1) A cannabis business shall:

(a) Maintain records as required by law; and

(b) Comply with all statutory and regulatory reporting requirements, and any other requirements published by the Comptroller.

(2) For each separate return required to be filed under COMAR 03.06.03.03, a cannabis business may claim the credit allowed under TaxGeneral Article, §11-105, Annotated Code of Maryland, for timely filing a sales and use tax return.

D. Exemptions.

(1) Sales Between Cannabis Businesses.

(a) Subject to §D(1)(b) and (c) of this regulation, the sales and use tax does not apply to the retail sale of cannabis between cannabis businesses that are licensed under Alcoholic Beverages and Cannabis Article, Title 36, Annotated Code of Maryland.

(b) A licensed buyer shall present a resale certificate to the licensed seller as evidence of eligibility for the exemption under §D(1)(a) of this regulation.

(c) A seller shall retain a record of the sale in compliance with COMAR 03.06.03.02.

(d) Except as provided in §D(1)(e) of this regulation, the resale certificate shall include the information required in Regulation .14 of this chapter.

(e) If the buyer is not required to obtain a sales and use tax license, the buyer shall include its cannabis business license number instead of a sales and use tax registration number on its resale certificate.

(2) Sales of Medical Cannabis.

(a) The sales and use tax does not apply to the sale of medical cannabis under Alcoholic Beverages and Cannabis Article, Title 36, Annotated Code of Maryland.

(b) For every sale of medical cannabis, the seller shall record the qualifying patient or caregiver's registration number and retain a record of the sale in compliance with COMAR 03.06.03.02.

E. Clarifications.

(1) Notwithstanding Tax-General Article, §11-104(j), Annotated Code of Maryland, regarding the sales and use tax rate for certain vaping liquid containers, the sales and use tax rate for vaping liquid containing cannabis shall be the rate applicable to cannabis under Tax-General Article, §11-104(k), Annotated Code of Maryland.

(2) Notwithstanding the exemption from sales and use tax for certain food, the sale of food or edible products containing cannabis shall be subject to the sales and use tax rate applicable to cannabis under Tax-General Article, §11-104(k), Annotated Code of Maryland.

Md. Code Regs. 03.06.01.47

Regulation .47 adopted effective 50:16 Md. R. 725, eff. 8/21/2023