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Oklahoma Senate will hear bill to remove sales tax exemptions for cannabis growers, monitor their water use

Seth Bodine / KOSU
Marijuana growing at Iris Farms outside Stillwater, Okla.

Oklahoma farmers and ranchers are exempt from paying sales tax on many materials and equipment they use in their agriculture.

Senate Bill 133, which would disqualify cannabis producers from this exemption, is advancing to the Senate Floor.

Republican David Bullard of Durant, who authored the bill, said cannabis producers haven’t been using the exemption to save much money on sales tax—only about $250,000 each year.

But the exemption also prevents the state from monitoring their water use, which Bullard said is a problem.

“In my research, we are finding out that they are using a massive amount of water,” Bullard told the Senate Finance Committee on Monday. “We have no way to know how much water they're tapping into.”

The bill would declassify cannabis as an agricultural product and subject producers’ water use to state monitoring.

This exemption has been in place for agricultural goods produced in Oklahoma since 1942. Democratic Senator Julia Kirt of Oklahoma City says she doesn’t think cannabis should be treated differently than other agricultural industries.

If we're going to start assessing businesses around those kinds of metrics, we need to do it for all businesses, not just for medical marijuana businesses,” Kirt said.

The Senate Finance Committee approved the bill, which will move on to the full Senate.


Graycen Wheeler is a reporter covering water issues at KOSU as a corps member with Report for America.
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