The 3 percent local tax is imposed by a single boss.
By Rebecca Rivas, Missouri Independent
Missouri Supreme Court heard arguments on Tuesday about whether or not counties and cities can impose multiple marijuana sales taxes. The legal dispute began in 2023.
According to Missouri Department of Revenue, the court’s decision will affect more than 70 counties and cities in Missouri, which have imposed a 3 percent dispensary tax.
This case is centered on Robust Missouri 3 LLC in Florissant, where the customers pay a combined sales tax of 20.988 percent. That includes 3 percent from both Florissant City and St. Louis County.
Robust says it is not constitutional for customers to be taxed by two local governments.
At the hearing on Tuesday, Eric Walter, Robust’s lawyer, said, “There is only one local government. One boss. One master who dictates outcomes. And imposes the 3 percent fee.”
He said that St. Louis County, and St. Charles County, have the right to levy a 3 percent property tax in unincorporated areas. However, this is not applicable across their whole geographic area.
In November, a panel of Missouri appeals judges agreed that Robust’s ruling, which stated the Constitution was “plain and unambiguous”, meant cities and counties could not stack marijuana taxes.
In a unanimous decision, Judge John Torbitzky of Missouri Court of Appeals Eastern District stated that only one local government was authorized to impose a three-percent sales tax.
The decision reversed a previous ruling by a lower judge last year, which had allowed St. Louis County and Florissant to impose a combined 3 percent tax on marijuana.
St. Louis County circuit judge Brian May stated that accepting Robust’s interpretation would result in “absurd” outcomes, because a city or municipality would be able to disregard any ordinance or regulations of the county, even those relating to health and safety, which are unrelated to taxation.
May was largely talking about public health regulations—particularly those that apply to marijuana dispensaries—because public health in Florissant is regulated by St. Louis County.
Walter’s response to the May ruling, which stated that Robust had “effectively nullified” county ordinances concerning health and safety.
Walter was able to convince the court that this case did not involve the county’s health code.
Laura Robb, the attorney for St. Louis County, said on Tuesday that the amendment to the Constitution approved by voters in 2022, legalizing recreational marijuana, has “public health” as its purpose. Florissant is dependent on St. Louis County because they enforce public health laws on all of its businesses.
Robb said to judges on Tuesday that it was only fair and logical for a part of the revenues generated by this institution be given over to them.
Robb and May agreed that the “absurd” result would be to allow dispensaries to operate without being governed by public health laws that govern every other building in Florissant.
According to the constitutional amendment, the term “local government” refers to “a town, village or city in an area that is incorporated, and a county for an area without incorporation.”
At a hearing last year, attorneys for St. Louis and St. Charles counties argued the word “and” is key in the definition.
Robb was asked by Kelly Broniec, a Supreme Court judge to examine the “local control” section of the Constitutional Amendment. It explains how citizens can ban dispensaries from their cities and towns by voting.
Broniec read the question the law states should be submitted to voters: “Shall (insert name of local government) ban all non-medical microbusiness dispensary facilities and comprehensive marijuana dispensary facilities from being located within (insert name of local government and, where applicable, its ‘unincorporated areas’) and forgo any additional related local tax revenue?”
Broniec was asked whether this provision supported the counties definition of local government, or Robust?
“If one of the local governments disallowed it and one allowed it—if it was on the same ballot, let’s say—whose would control, if both the city and the county are a local government,” Broniec asked.
Robb answered, “I do not know the answer.”
Walter told Broniec later that he liked her question.
“It was very insightful, because when you talk about the constitutional authority allowing the local government to outright ban dispensaries, there’s a particular procedure,” Walter said, “and…even dictates what the language needs to be when presented to the voters on the question.”
Walter pointed to the Missouri Constitution, which states that every one of Missouri’s eight congressional district must have a minimum 24 marijuana dispensaries. If the 2nd Congressional District were to ban dispensaries, it would only leave a small part of St. Charles County and Jefferson County to accommodate 24.
Walter stated that this would be an invasion of the rights of the ninety-nine, unique towns within St Louis County. They should decide if they want the businesses to serve their citizens.
The original publication of this story is Missouri Independent.
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Side Pocket Images. Photo by Chris Wallis.