New York Lawmakers Send Governor Bill To Extend Marijuana Business Tax Return Deadlines

Both chambers of the New York State legislature have now passed legislation
that would extend the deadline for some marijuana businesses to file
electronic tax returns, sending the proposal next to the desk of Gov. Kathy
Hochul (D).

If signed into law, the proposal would give cannabis manufacturers and
distributors 30 extra days to submit their tax returns following the end of
each quarterly tax period. Currently the companies have a 20-day window to
file the documents, which the legislation would extended to 50 days.

“This will give extra time to complete accurate tax filings and create more
flexibility as the market continues to mature,” lawmakers behind the
measure said in a press release on Thursday. “Ultimately, this bill will
provide a more realistic approach to the tax collection timeframe while
promoting filing compliance and maintaining tax revenue and rates.”

Assemblywoman Donna Lupardo (D), the Assembly-side sponsor and chair of
that chamber’s Agriculture Committee, said that while the retail side of
the industry is more visible to New Yorkers, farmers and distributors are
nevertheless a crucial piece of the legal market.

“We hope our effort to provide tax flexibility for NY’s cannabis
manufacturers and distributors will succeed,” Lupardo said. “Although often
unseen, they represent a critically important part of NY’s legal cannabis
supply chain, without which the retail sector would not exist.”

Senate-side sponsor Sen. Jeremy Cooney (D), who chairs the chamber’s
Cannabis Subcommittee, said that “cannabis farmers deserve the state’s
help, and this bill would provide that much-needed relief.”

“I was proud to work with Assemblymember Lupardo and our colleagues in the
legislature to get this done before the end of session, provide greater
financial flexibility for our farmers, and show that we’re committed to
building a thriving legal cannabis market in New York,” he said in a
statement.

A cosponsorship memo attached to the bill explains:

“Under current law, the cannabis excise tax is paid quarterly by cannabis
cultivators and processors to the NYS Department of Taxation and Finance.
This excise tax payment schedule creates situations where product producers
and processors often owe taxes before the product is sold to consumers.
This legislation changes the tax collection payment schedule by allowing
the option for the payment on or before the fiftieth day after each
quarterly tax period.

The slow opening of cannabis dispensaries, due to multiple factors, has
created a backlog of products on processors shelves, which have yet to be
sent or sold to retailers, yet the tax is still owed. Another factor
creating stress on the processor’s ability to pay the excise tax, is that
some retail dispensaries are delinquent in paying for products they have
received. There is a prompt payment provision in the cannabis law, but, due
to many factors the provision is not being enforced. By allowing the tax to
be collected on a more flexible schedule it will allow flexibility in the
market as it matures and provides a financial lifeline to currently
struggling producers and processors.”

Mack Hueber, president of the Empire Cannabis Manufacturer’s Alliance trade
group, called the proposal (A5496/S3261) “a common-sense approach by the
legislature to extend cannabis excise tax deadlines so that manufacturers
and distributors have time to collect and accurately file hundreds of
millions of dollars in excise tax revenue to New York State.”

“We applaud Senator Jeremy Cooney and Assemblymember Donna Lupardo for
recognizing that our cannabis manufacturers are one of the state’s
fastest-growing employment sectors, responsible for generating significant
revenue that supports community grants, education funds, addiction
services, and law enforcement,” he said in the release. “They have found a
solution that takes into account both regulatory and on-the-ground
realities that will not change or reduce tax revenues, but provide an
additional 30 days to file at the end of each quarter. We look forward to
Governor Hochul’s swift signing of A5496A/S8091.”

Sponsors of the bill noted that Hochul vetoed an earlier cannabis business
tax reform proposal late last year, claiming it would “pose significant
operational challenges for the State and confusion for taxpayers,” but that
they’ve worked to address those concerns in the current version.

The earlier, vetoed measure would have allowed marijuana growers and
processors to pay excise taxes on an annual basis rather than quarterly—a
change that would have extended the same treatment to cannabis as the state
already offers the alcohol industry.

Nicholas Guarino, the founder and CEO of cannabis business Jaunty, wrote in
a recent op-ed for Marijuana Moment that the shift to an annual tax-filing
system “would allow businesses to better manage cash flow, invest in growth
initiatives and adapt more effectively to market demands as more stores
open and more potential customers have access to a range of products.”

Earlier this month, meanwhile, New York officials announced the first round
of grants under a $5 million program to help retail marijuana businesses
owned by justice-involved people cover startup costs.

About three months after opening up applications for the Conditional
Adult-Use Retail Dispensary (CAURD) Grant Program, the Office of Cannabis
Management (OCM) and Empire State Development (ESD) announced on Wednesday
that they have awarded 52 licensed dispensaries up to $30,000 each in funds
meant for startup and operational costs such as rent, renovations,
inventory tracking and security systems.

To qualify for the program, applicants need to have been “justice
involved”—in other words, impacted by a marijuana-related conviction—and
have some experience running a profitable business.

Meanwhile, OCM recently launched a new online map that’s meant to help
adults locate licensed marijuana retailers—one of their latest efforts to
encourage consumers to buy their cannabis from the regulated market.

After a rocky rollout of the state’s legalization law opened the door to a
proliferation of illicit marijuana shops, the governor and regulators have
prioritized educating the public about the need to purchase their products
from licensed dispensaries as a health and safety imperative.

The broader New York campaign has also involved digital ads and educational
resources, including a guide on safe consumption practices, as well as
graphics and videos featuring licensed cannabis business owners and
messaging about the benefits of participating in the regulated market.

OCM also advises that “continued enforcement against the illicit market is
critical to building a health regulated market,” pointing to what it
describes as successful enforcement efforts in 2024. Last spring, for
example, officials in New York City launched Operation Padlock, an
enforcement initiative meant to shutter illegal storefronts. Within months,
licensed shops that were open before the operation began saw sales climb
105 percent, according to an OCM survey.

Regulators are also moving forward with new proposed regulations around the
state’s so-called “cannabis showcase” program, which allows licensed
businesses to sell to consumers at pop-up, farmers market-like events.

As originally authorized, the showcase events were largely in response to
the slow rollout of New York’s adult-use marijuana program, which faced
multiple delays in implementation amid litigation and other matters.

But the state’s industry has gradually expanded, with officials in January touting
$1 billion in total sales since the market launched.

Separately Hochul signed state budget legislation that did not include a
controversial earlier provision that would have allowed police to use the
smell of marijuana as probable cause that a driver is impaired and then
force them to take a drug test.

Amendments made in the legislature removed the provision, which a coalition
of 60 reform groups had argued in a letter to Hochul and top lawmakers
would “repeat some of the worst harms of the War on Drugs” and allow law
enforcement to “restart unconstitutional racial profiling of drivers.”

A recent OCM report also found that the number of licensed marijuana
retailers in the state grew by nearly threefold last year, fueling total
sales in 2024 of nearly $870 million.

Including sales so far in 2025, New York’s legal cannabis market is now
close to reaching $1.5 billion worth of purchases, OCM said in April.

Also that month, New York cannabis regulators and labor officials announced
the launch of a workforce training program aimed at “providing
comprehensive safety education to workers” in the state’s legal marijuana
industry.

Separately, OCM’s press secretary recently indicated the office is working
on plans to expand permitting and licensing rules that could allow adults
to buy and consume marijuana at movie theaters. Authorizing sales of
cannabis products at theaters would set New York apart as it continues to
build upon the state’s legalization law.

Earlier this year, a collective of businesses licensed under the CAURD
program called on Hochul to forgive tens of millions of dollars in
high-cost loans issued under a governor-created social equity loan fund.

A state lawmaker said in December that there’s a need to extend financial
aid to CAURD license holders, many of whom are struggling under the
high-cost loans.

Critics—including the NAACP New York State Conference, Black Cannabis
Industry Association, Minority Cannabis Business Association, Service
Disabled Veterans in Cannabis Association, Drug Policy Alliance, NYC NORML
and VOCAL-NY—wrote to the governor earlier that month to express dismay at
what they described as marijuana regulators’ “efforts in service of big
corporations at the expense of small business and equity outcomes.”

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*Photo courtesy of Chris Wallis // Side Pocket Images.*

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Tax Return Deadlines appeared first on Marijuana Moment.