On October 16, 2013, the Washington State Liquor Control Board adopted rules to implement Initiative 502, approved by voters in November 2012, which legalized the sale of marijuana and authorized the imposition of excise taxes and license fees. The rules advise that a 30-day registration period will open for all license types on November 18, 2013. A three month state residency requirement is in place for all license applicants. The residency requirement also applies to all members of partnerships, employee cooperatives, associations, nonprofit corporations, corporations and limited liability companies applying for licenses. License applicants must submit a signed attestation that they are current on taxes owed to the Washington Department of Revenue as an individual or as part of any entity in which they have an ownership interest.
Initiative 502 creates three new licenses, for marijuana producers, processors, and retailers. The application fee for each license is $250, and the annual renewal fee is $1,000. An excise tax of 25% will be imposed on each licensed retail sale of marijuana/marijuana infused product. This tax constitutes part of the total retail price and is in addition to all state and local sales and use taxes. A 25% excise tax will also be imposed on each sale between a licensed producer and licensed processor, and on each sale between a licensed processor to a licensed retailer.
All licensees must submit monthly reports and payments to the board by the 20th day of the month for the previous month. The reports must be filed separately for each marijuana license held. All records must be maintained and available for review for a three-year period.
On August 29, 2013, U.S. Attorney General Eric Holder informed the governors of Washington and Colorado that the Department of Justice would permit the states to create a regime that would regulate the ballot initiatives that legalized the use of marijuana by adults.