Green Market Report: California’s Crushing Cannabis Taxes

Green Market Report: California’s Crushing Cannabis Taxes
CANNANNEW REPORT

Part 3 of Green Market Report’s series on California‘s war on cannabis. If you were to ask what the main problem facing the largest cannabis market in the country is, there would be one resounding answer – TAXES. Cannabis taxes on the state and local levels are choking the life out of businesses across the state of California and cultivators, manufacturers, and retailers are looking for relief anywhere. Currently, businesses are subject to a $161 a pound state cultivation tax for flower, then a 15% state excise tax (which is really 27%, but we’ll get into that later), a 10% state sales tax in most areas, not to mention the varying local cultivation, processing, manufacturing, distribution, and retail tax, effectively making the tax rate on the average cannabis purchase about 50%. At first glance, these taxes might seem reasonable, but when examined more closely they are not what they seem.  For example, the 15% excise tax is really defined by an arm’s length transaction with a 15% rate being based on 80% of the retail price and not the wholesale price, effectively truly making the rate 27%. These onerous taxes aren’t levied on any other industry except for cannabis and business owners are crying out for mercy.  Legislators on the state and local levels are looking to provide band-aids to the situation, but so far only Senate Bill 1281 is offering long-term solutions. Read full article at  California’s Crushing Cannabis Taxes

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Source : Green Market Report: California’s Crushing Cannabis Taxes

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