California Marijuana Taxes Way Too High
Medical Patients pay about 12% in tax while Recreational users pay as much as 45%, you to can get a big tax break with recommendation from a licensed doctor for your conditions and symptoms
Tax on weed is now 35% at most dispensaries and could soon rise to 45%, but MMJ patients can avoid most tax with a Medical Marijuana Card, how to get one online? And once you get your medical card, what are your special rights under the new laws? First we quote real experts, guys that have operated in the business at a high level for a decade, then our medical marijuana expert chimes in about rules and regulations, along with some witty and sage opinions from California citizens who are dealing with the new rules now.
“In our shop here, the tax rate has gone from 15 percent all the way up to almost 35 percent for adult consumers.” Steve DeAngelo
When California marijuana tax will reaches 45 percent, it will effectively work in opposition the premise of legalization, as a large chunk of the public will return to the black market to save money. If you can qualify to get a Medical Marijuana Card, you'll be exempt from much of that tax, saving $70 or even $100 per ounce. Insomnia, cramps, migraine, stress, inflammation, neurological disorders and chronic pain are among the conditions that can qualify a California adult as a medical marijuana patient.
While marijuana dispensaries across California experienced long lines on the first days of legal recreational marijuana sales, advocates warn that the legal industry won’t survive without big changes.
“I’m very happy about – thrilled really – to see the legalization of cannabis in California, at the same time, I’m terrified about what’s going to happen with these taxes. In our shop here, the tax rate has gone from 15 percent all the way up to almost 35 percent for adult consumers” - Steve DeAngelo, Harborside Dispensary Boss
Harborside has been a major medical marijuana dispensary twelve years and is now selling recreational marijuana at a much higher price. Here’s how the math works for Harborside. There is the regular state goods sales tax of 6 percent, plus the regular County sales tax of 3.25 percent and now there is a 15 percent state tax on marijuana, and a 10 percent Oakland tax on recreational marijuana.
"If you smoke pot and your health is not perfect, you want to see if you can get a medical marijuana card. Regular consumers will save fifty, a hundred bucks a week." - Johnny Rodriguez
Total taxes in the Bay Area: 34.25 percent. On an quarter of an ounce of weed with a $100 tag, that's an extra $35 bucks, if you throw in a 75 cent tip.
“That is a huge hit. And it’s going to mean that a significant number of people, less affluent consumers, are going to turn to the lower prices of the underground market,” DeAngelo said.
Many customers are willing to pay a premium for quality product, which might be the case if the lab testing and screening for moldy and sprayed weed works according to the master-plan. While the black market will be able to compete on price, there are hundreds of products that the upper tier dispensaries have that are not on the black market.
"Amid constructed a complicated new system considering public health and safety, credit rating and research agency Fitch Ratings reports that proposed taxes include a 15 percent state excise tax and state cultivation taxes of $9.25 per ounce for cannabis buds, as well as state and local sales taxes ranging from 7.75% to 9.75%. Altogether, that’s about 45 percent. The only other US state to tax marijuana that high is Washington, which is close to 50 %, Oregon has a tax rate of 20 %, while Alaska has a wholesale tax of $50 per ounce." - bigbudsmag.com
Stephen Walsh, director of US public finance at Fitch Solutions, affirmed,
“High taxes increase prices in legal markets, and have the effect of reinforcing price advantages to long established black market cannabis. All of our medicine is tested in a laboratory, It’s evaluated both for safety, for things like pesticides and pathogenic molds, and potency.” - Deangelo
So, in addition to taxes, marijuana regulations and the cost of testing will further drive up costs.
“We have to pay rent, we have to have security systems, we have to pay licensing fees, we have to have insurance, we have to buy equipment,” DeAngelo
Not everyone can pay the higher prices with the majority of the population on a fixed income. Thankfully, people that need marijuana to sleep, for pain and other conditions can get a medical marijuana card to make weed more affordable.
“Some can barely afford cannabis now, much less with a 35 or 40 percent tax increase,” DeAngelo
If the state and counties are really greedy and want to maximize taxes, they want to stomp out the black market competition. That means providing quality weed at affordable prices, for there is efficiency in doing everything right to, some of the regulations help productivity too. At the end of the day, there is a tax point where the average person will consider buying illegally again.
That number is probably around 20% and 45% will definitely result in unmitigated disaster.
The overtaxation movie played out in Colorado, Washington state and Oregon, who each legalized marijuana at one tax rate and then had to lower it because the black market came back with force. So, having learned nothing about the exploits of many others, California is set on a path of failure as the tax rate for cannabis is unsustainable.
DeAngelo says it's crazy that marijuana is taxed much more than alcohol. Over the past twenty five years, California taxes beer and wine at 20 cents a gallon, and there is no rational that weed should be different. Even the Federal Government decreased the taxes on beer, wine and spirits.
Comments - Selected Reddits
The high tax may very well cause people who currently get pot on the black market to keep doing it that way. But more sheltered people who don't know any dealers are likely to just pay the tax so they can get it legally. I mean, think about it...when you want to buy a new stereo, do you seek out a fence to sell you a stolen one cheaper, if you don't already know a fence?
FUCK!! The Socialist Republic of California led by that greedy 'I wanna take every dime from every taxpayer' Chairman Jerry Brown. "Could fuel black market sales" ??? Duh!! And these voters keep voting in favor of the citizenry every day bending over and saying "Thank you sir!! May I have another?"
45% not to mention that today our gas tax goes up another 12%. Goes into effect the same day we switch to the cheaper winter fuel hoping no one really notices.
I think some California politicians would stop being so stupid if they started catching bullets. But then again, people who are getting high aren't motivated enough to do that.
420EVALUATIONSONLINE - The California Medical Board encourages the use of Telemedicine for routine medical services, where the level of care is equivalent to a visit to the clinic. Our online process - a 420 evaluation - takes only a few minutes. Just answer a few questions about your conditions and symptoms - and a licensed medical doctor will review your file on his tablet. Patients don't pay unless they qualify for a California Cannabis ID Card or Medical Marijuana Recommendation, or a special grower's license. Marijuana is commonly recommended for the following conditions and symptoms.
ADD & ADHD
Anxiety & Stress
Autoimmune Disorders (AD)
Cachexia & Wasting
Multiple Sclerosis (MS)
Schizophrenia & Psychosis
High Blood Pressure
High Eye Pressure (IOP)
Q & A Medical Marijuana Dispensaries in Cali 2018 - Twitter: JacobMargolis
Q Can the current medical shops become recreational shops? If so, what is the process/timeline like? Also, when can we expect to see recreational shops pop up?
A No, medical shops won't become recreational shops overnight. Their ability to switch over really depends on where the shops are located and what a municipality decides to do. I'll use LA as an example, as that's where I'm based and it's shaping up to be one of the larger MJ markets in the state.
Medical shops that have followed the rules laid out by Proposition D (which basically laid out local medical MJ rules), paid their taxes and generally complied with the law, are trying to position themselves to be some of the first to get state licenses. That could mean licenses for medical or recreational. But, talking to several shops, they're ready to take on recreational users as well. So, everyone's jockeying for licenses.
In terms of when that'll actually happen, it's unclear. There are two licensing systems that need to be established at the local and state levels. LA is writing theirs up right now and people in the city will be voting on the rules come March 10. After that, things will continue to change and be worked out, BUT at least they'll have guidelines for how licenses will be handed out.
After that, the state will work out their licensing system, supposedly by 2018, but that is a major ask that might not come to fruition, or might be delayed. We'll have to see.
I'm actually doing a piece on this today to publish tomorrow. I'll come back and post it here.
Q How much is a start$up for a marijuana farm?
A Are you curious about start up costs? So, would that be equipment, land and licensing requirements? Will it be indoor or outdoor? How big would you want it to be? There are all sorts of different size requirements related to licensing in California. If you're curious about a particular scenario, I'm happy to zone in on it for you.
Q 30 acres, outdoor, all of the equipment and licensing. From nothing to a functioning farm
A There's a limit to the size of the cultivation lots. The limit until 2023 is 1 acre, or 43,560 square feet. I don't know how much equipment is, or licensing. Licensing because there hasn't been a system established yet. In terms of equipment...that would be interesting to talk to a farmer to see what they would do to build one. I'll look into it.
Q Do you think Jeff Sessions being appointed to the Attorney General position by Donald Trump will affect the state's progress in terms of medical and recreational marijuana legalization / decriminalization? Do you think there is any hope for the marijuana industry going forward with this appointee?
Q Reaching out via email. One question, how can Medical Marijuana Inc continue their operations in light of the DEA decision regarding CBD? Is the DEA decision truly invalid?
A Plenty of operations have existed and will continue to exist even though the DEA has clarified their classification of CBD as a schedule 1 substance. That's my personal opinion based on the fact that there are several states with humongous industries based on recreational marijuana, which is very much still a schedule 1 substance.
Q What do you mean invalid?
A By invalid, I am referring to the many publications that are saying the DEA does not have the authority to regulate industrial hemp and CBDs, citing that that authority lies with the Department of Agriculture and the FDA.
Q I live in San Luis Obispo, California. What changes will us Californians see as a result of the newly voted recreational law being passed into effect? I am thoroughly delighted that the law has passed, but am unclear on when it will take place and if there will be any shops that will open in San Luis Obispo County or even my town of SLO. Does the law additionally state that we have to smoke on our own property or will there be zoned businesses where we can toke up? Thanks so much! :D
A The law took effect on November 9, 2016. However, recreational shops aren't likely to pop up for a year or more.We'll have to wait and see what licensing system SLO comes up with. That'll determine how many shops will open up. In regards to smoking on your own property, you can, unless you're in a rental unit. In that case, you need to read your lease to see if it's prohibited. In terms of zoned businesses, we'll have to see if they're allowed, but I can't imagine they won't be, once the new licensing system is worked out.
Q What about employment and drug testing. Do you think there's any way hard working Californians can work a 40 hour week sober, but when we get home after 5 lights up a fat one and decompress? I think this is one of the major overlooked issues. I have an uncle with prostate cancer and we want to try cannabis oil treatments in addition to his hormone therapy. He does have a medical card that he just got (neither of us are sure how it works yet). The only problem is that the oil needs to be very specifically concentrated and responsibly sourced and, according to most, the only way to be sure of that is to make it yourself from dried buds using a very specific filtering method (there are apparently lots of scammers out there trying to pass off phony or faulty cannabis oil as a cancer cure). Now that it's legal here, I would like to try to make it ourselves, but it's kind of a catch 22. I mean, it's legal to have it, but where do you get it?
A Think about getting a medical marijuana Card, it's good anywhere in California and the price is about 25% less for patients.
Q Would there still be jail time if i was caught with 2 grams in public - Possession?
A You should be fine if you're over 21. The limit is 28.5 grams according to Prop 64. That's about one ounce. If you were caught with more than that, you'd likely be hit with a small fine. If you were a repeat offender you could be charged with a misdemeanor. The age limit is 21 or older and consumption in public is not legal.
Q Can you smoke in your apartment?
A http://www.scpr.org/programs/take-two/2016/12/02/53426/can-you-smoke-and-grow-weed-in-your-rental-unit/ the more politically attuned property managers anticipated the potential voter approval of CA Prop 64. they have recently inserted a clause in their standard rental agreement to address the concerns of new tenants surrounding Prop 64 - cultivation of medicinal cannabis by the named tenant within the rental unit is permitted, as long as there is no unauthorized alterations to the premises or modifications to the electrical outlets/wiring/fixtures and as long as there is no increased risk of fire, flood or other hazard to the property and as long as a portion of the mature, cured tricome bearing flower sections equal to/or greater than 25% in weight of the total harvest is delivered on the 1st of the month to the landlord or landlord's designated agent.