Rogue department continues to thwart patient access despite legislators removing agency’s cannabis powers 

(Albuquerque) – The New Mexico Department of Health (NMDOH) filed proposed rule changes to its patient purchase limit regulations on Wednesday, October 13, 2021, that will illegally tax more than 125,000 vulnerable, low-income medical cannabis purchasers despite legislative clarification in the Cannabis Regulation Act.

NMDOH asserted that patients will need to pay punitive, illegal taxes on cannabis purchases exceeding 15 ounces over a 90-day period, despite specific language in the Cannabis Regulation Act prohibiting taxes on medical cannabis purchases. In comparison, adults 21 years and older may purchase 2 ounces of cannabis, 16 grams of cannabis extract, and 800 milligrams of edible cannabis at any one time. 

“The cannabis excise tax shall not apply to retail sales of medical cannabis products sold to a qualified patient or a primary caregiver who presents a registry identification card issued pursuant to the Lynn and Erin Compassionate Use Act or a reciprocal participant who presents similar proof from another state, the District of Columbia or a territory or commonwealth of the United States,” the Cannabis Regulation Act states.

NMDOH’s illegal tax scheme will also require patients to pay Gross Receipts Tax, which is also barred by the Cannabis Regulation Act. 

“Receipts from the sale of prescription drugs and oxygen and oxygen services provided by a licensed medicare durable medical equipment provider and cannabis products that are sold in accordance with the Lynn and Erin Compassionate Use Act may be deducted from gross receipts and governmental gross receipts,” the Cannabis Regulation Act continues. 

Total illegal taxes weighing on vulnerable cannabis patients shall be between 20 to 26 percent. The Cannabis Excise Tax starts at 12 percent and increases by 1 percent beginning in 2025 until it reaches a high of 18 percent in July 2030. Gross Receipts Tax is about 8 percent statewide.

The illegal taxes will make it an undue hardship to purchase cannabis in amounts patients need. Based on the most recent NMDOH patient survey, 26 percent of New Mexican cannabis patients live in households earning less than $20,000 annually and 69 percent of patients live below the state’s median household income of $52,911 annually. 

More than 124,463 patients will be affected by this proposed regulation based on NMDOH’s most recent patient statistics report. 

Furthermore, the Cannabis Regulation Act specifically removed NMDOH’s authority over the Medical Cannabis Program as of June 29, 2021. 

“Except for administration of the medical cannabis registry, the power, duty and authority of the department of health related to the medical cannabis program shall be transferred to the division on the effective date of the Cannabis Regulation Act,” the law states. 

Not only are the proposed rule changes punitive for patients, they effectively punish licensed cannabis producers. The rules require patients to make purchases as commercial cannabis users when producers are required to sell a quota of cannabis to qualified medical purchasers, specifically. 

“In carrying out its commercial cannabis activity licensing duties, the [Cannabis Control Division] shall: (5) allow commercial cannabis activity retail sales no later than April 1, 2022, and otherwise allow activities authorized by the Cannabis Regulation Act or the medical cannabis program as of the time of licensure of a licensee, so long as a minimum of twenty-five percent of monthly cannabis sales are to qualified patients, primary caregivers, and reciprocal participants or sold wholesale to other licensees that meet or exceed the twenty-five percent sales to qualified patients, primary caregivers, and reciprocal participants until December 31, 2022,” the Cannabis Regulation Act states (emphasis added).

NMDOH will conduct a hearing to receive public comment on the proposed rules at 9:00 a.m. on November 12, 2021, via Cisco Webex and telephone.