A “Wayfair” online sales tax would bring in an estimated $60 million-$80 million a year for Missouri, the state’s budget director told the Senate’s appropriations committee Wednesday.
No such projection was yet available for medical marijuana revenues.
Daniel Haug, director of the Office of Administration’s Division of Budget and Planning, said probably not as much as that would be brought in during the first year of a Wayfair tax, as it would take time for sellers to be informed.
A Wayfair tax gets its name from the U.S. Supreme Court case in which it was decided out-of-state sellers can be required to collect and remit a state sales tax.
Missouri legislators are working to pass such a tax this session; Missouri is one of two states — the other being Florida — that has not yet enacted a Wayfair tax.
Missouri Republican Sens. Mike Cunningham, Denny Hoskins and Sandy Crawford have filed bills that would enact a Wayfair tax that would apply to vendors with one-year cumulative gross receipts of at least $100,000 from Missouri sales.
Rep. Travis Fitzwater, R-Holts Summit, is among representatives who have filed similar legislation in the House.
Cunningham’s Senate Bill 529 specifically seeks that 80 percent of the collected revenues fund school transportation, and the other 20 percent be used to reimburse counties for jail costs owed by the state.
None of the three Senate bills — the others being SB 805 and SB 872 — have yet been heard by a Senate committee. Cunningham, of Rogersville, and Hoskins, of Warrensburg, serve on the Senate’s appropriations committee.
Gov. Mike Parson said last week in his State of the State address that he wants Wayfair tax revenue to be directed into a proposed cash operating expense fund.
The proposed fund would serve as a rainy day fund for the state, in case of economic emergency.
Once that fund would become solvent, Parson proposed Wayfair collections will be used to pay off debt and pay for infrastructure programs done on a cost-share basis.
Parson recommended separate funding increases for school transportation and county reimbursements in his proposed budget for the 2020-21 fiscal year.
Haug said Wednesday that with Parson’s recommended $100 million initial investment into the proposed cash flow fund, followed by Wayfair revenues, it would probably take two or three years for the cash flow fund to become solvent.
Solvency would mean a level of 2.5 percent of the net general revenue collections for the previous fiscal year.
Haug said he did not yet know how much revenue to expect from sales of medical marijuana.
The Missouri Department of Health and Senior Services recently started issuing licenses for medical marijuana-infused products manufacturing facilities.
Marijuana-infused products contain marijuana or an extract and are intended for use or consumption by a means other than smoking. This can include edible products, ointments, tinctures and concentrates.
Licenses for dispensary facilities and seed-to-sale tracking systems are expected to be issued later this month — on Friday, for dispensary facilities.
DHSS expects dispensary medical marijuana retail establishments will open sometime in late spring or early summer.
Haug said with budget calculators currently being conservative about expectations for medical marijuana revenues, $2 million of proposed budget items related to military veterans are expected to be supported by medical marijuana.
A more than 65 percent majority of Missouri voters in November 2018 approved medical marijuana use — with a doctor’s order — by state constitutional amendment. Proceeds from a 2 percent tax on medical marijuana sales are to support Missouri veterans.