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New York - Outbound - Manage Adult-Use Cannabis Products Tax
This article covers tax on outbound invoices. For how retail sales are taxed at the register, see New York Retail: Adult Use Excise Tax and Discounts. Tax Calculation Change. NY Potency Tax for adult…
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Tax Calculation Change
NY Potency Tax for adult-use cannabis products tax update Effective June 1, 2024. Effective for sales on and after June 1, 2024, the total THC-based (potency) tax rates on adult-use cannabis products have been replaced with a single percentage-based tax rate of 9%. This new rate is imposed on the amount charged for the sale or transfer of adult-use cannabis products by a distributor to a retailer.
Learn more here: Adult-use cannabis products tax.
We understand that every business has unique needs and processes. That's why we've given you the flexibility to either automatically calculate the tax and add it to your invoices or exclude it from them. This way, you can adapt the tax calculation method that best suits your operations, ensuring a smooth transition to the new tax rate.
Set The Tax To Zero For All New Outbound Invoices
After following the steps below, Flourish will explicitly set the Est. Excise Tax on the order to zero when you create a new outbound invoice. However, if needed, you can still calculate the tax on a specific order.
| The Setting Outbound Order Totals with the Setting ON   |
Settings.Manage Tax Calculation On A Single Order
Manage the tax calculation for a single order by checking and unchecking the box next to Est. Excise Tax.
Checking the box calculates the tax, if applicable. | Unchecking the box sets the tax to zero. |
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New York Retail: Adult Use Excise Tax and Discounts
New York requires retailers to calculate the Adult Use Excise Tax on the price before any discount is applied (9 NYCRR § 129.3(b)(2)). Flourish does this automatically for New York adult-use retail sales. The Adult Use Excise Tax (State) and Adult Use Excise Tax (Local) lines are both calculated on the pre-discount price.
The customer pays the discounted price plus tax on the full price. For example, at a combined excise rate of 13%, a $100.00 item with 20% off is $80.00 plus $13.00 in excise tax, for a total of $93.00.
- Excise tax collected on discounted cannabis items is higher than before this change. Let your store staff know before the customer sees the total at checkout.
- Sales tax on non-cannabis items, such as accessories, is still calculated on the discounted price.
- This does not change how Est. Excise Tax is calculated on outbound invoices.
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