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Bill would let Liquor and Cannabis Board verify medical excise-tax exemptions using DOH registry
Summary
House Bill 1341 would authorize the Liquor and Cannabis Board to verify cannabis excise-tax exemptions through the Department of Health's medical cannabis authorization database. Sponsors and agency witnesses said the change is intended to prevent abuse of a tax exemption created last year for registered medical patients.
House Bill 1341 would allow the Washington State Liquor and Cannabis Board (LCB) to verify excise-tax exemptions for medical cannabis purchases by checking the Department of Health (DOH) medical cannabis authorization database.
What the committee heard: Megan Mulvihill, staff to the committee, briefed members on the DOH-managed medical cannabis authorization database and described current tax rules: qualifying registered patients or designated providers issued a recognition card are exempt from sales and use taxes and the 37% cannabis excise tax, but only when purchasing DOH‑compliant products at retailers that hold a medical cannabis endorsement.
Representative Sharon Wylie, the bill sponsor from the 49th District, said the medical exemption created last year aims to protect patients who rely on medically controlled cannabis products that meet stricter safety and labeling standards. She described patient privacy and market concerns that led to the registry and explained that some patients avoid registering because of privacy worries.
Mark Webster of the Liquor and Cannabis Board told the committee the bill is an agency request and that the proposed statutory change is needed because current law explicitly authorizes only the Department of Revenue to verify sales-tax exemptions. Webster said lawyers advised the LCB that a data‑sharing agreement alone would not be sufficient under current statute; adding the LCB explicitly to statute would allow the board to confirm that excise-tax exemptions are used only for registered patients purchasing DOH‑approved products at medically endorsed retailers.
Caitlin Ryan, executive director of the Cannabis Alliance, supported the bill and said the excise-tax exemption has spurred availability of medical-compliant products and medical consultants in endorsed stores; she said renewals and new cards remain below historical registry levels and budgetary impact has been minimal.
What's at stake: Supporters described the change as a targeted compliance and anti‑abuse measure to ensure that the narrowly crafted medical excise-tax exemption operates as intended. Committee members did not take a recorded vote during the hearing.
