26.7 C
New York
Sunday, August 14, 2022

California scraps cannabis plantation tax

- Advertisement -

Regulated marijuana growers in California will see relief from some taxes that insiders say are stifling the industry with the passage of a law last week to repeal the state’s cannabis cultivation tax. The legislation, Assembly Bill 195, was signed into law by California Governor Gavin Newsom on June 30 after receiving broad bipartisan support in both houses of the state legislature the day before.

under AB-195The California plantation tax of over $161 per pound of cannabis flower will be completely eliminated. The bill, which represents a significant change in California’s tax structure for the legal marijuana industry, maintains a selective cannabis tax at its current rate of 15% for the next three years, after which the rate can be adjusted to replace revenue lost due to the abolition of the cultivation tax. “Survival of the regulated industry is vital to providing continued tax revenue to the state and advancing public health and safety,” says Lindsey Robinson, executive director of the Marijuana Trading Group, California Cannabis Industry Association (CCIA).

“Removing the agriculture tax is just one step toward stabilizing our industry, but it is an important step,” Robinson wrote in an email. “CCIA has worked for the past four years to abolish the agriculture tax and we are very proud of this important first step. Stabilizing the cannabis supply chain brings much-needed jobs and tax revenue to the state while protecting public health and safety and keeping cannabis out of children’s hands.”

New tax credits for some cannabis companies

This measure also creates new tax credits for some cannabis companies and transfers the responsibility for collecting excise tax on cannabis from distributors to retailers. In addition, AB-195 reduces the number of workers a company can employ to 10 before the requirements to create a labor peace agreement begin, which can lead to unionization by company employees. Nicole Elliott, director of the Department of Cannabis Control and the governor’s principal cannabis advisor, said the legislation was about as good as can be expected under the requirements of Proposition 64, a 2016 ballot measure legalizing recreational marijuana in California, to fund social programs including childcare, environmental cleanup and anti-driving efforts. Vulnerable with cannabis tax revenue.

“I am so proud of this law. It does an incredible amount of things to improve the lives of all Californians,” Elliott CalMatters said. “So I think we need to take some time to think about the fact that something amazing has been done.”

The passage of AB-195 will help support cannabis growers, who have seen wholesale marijuana prices fall by nearly 50% while the plantation tax rate has remained flat. Removing the tax will help small businesses survive in the state’s competitive, regulated cannabis market, said Jenin Coleman, founder of the Asset Council, an advocacy group that represents the cannabis business in the popular marijuana growing region of Northern California.

“It’s unbelievable that the agriculture tax has been abolished,” he said. Coleman said. “It has become untenable.”

Kyle Kazan, Chairman and CEO of glass house brandswhich has recently started its operations in what will eventually be a file Huge cannabis plant In Southern California, grateful for the abolition of the plantation tax as state leaders call for further reform of the cannabis tax structure.

“We appreciate the governor and legislature taking a step, and we hope it is an important step but not the only one. I hope in the industry the state will continue and reduce the excise tax from 15% to 5% before the end of the calendar year,” he wrote in an email. “The legal market competes with a market with a generational heritage and pricing issues that give inflation to everyone’s daily life that hits our consumer.”

Social justice advocates say the bill doesn’t go far enough

AB-195 also includes a $10,000 tax credit for the Cannabis Business in Social Justice, businesses licensed under programs to ensure representation in the industry from members of disadvantaged communities and those affected by cannabis prohibition policies. Social equity retailers will also be able to keep 20% of the cannabis tax they collect for three years. But critics of the legislation say the bill does not go far enough for social equity firms that are struggling to stay afloat in the California cannabis market, and which face stiff competition from unlicensed operators with far less oversight and oversight.

“What we got are basically crumbs from that law,” said Amber Senter, executive director of advocacy group Supernova Women. “Farmers will see relief, they will see a little money in their pockets, and none of this will flow down.”

State Democratic Senator Stephen Bradford, one of the few lawmakers to decline to vote for the bill, noted that the legislation primarily helps California’s cannabis growers, many of whom are wealthy and white, while social justice entrepreneurs of black and brown will see far less. Benefits of AB-195.

“This is a hard pill to swallow,” he said. “At some point, when are we going to put the real weight on and work behind what we all say is there?”

Bradford said he will continue to work to abolish the selective tax for social equity firms and enact other policies to support diversified ownership in the California cannabis industry.

“Without a doubt, more work is needed,” he said. “If we fall short on that, we’ll be back for the next session.”

**********

Are you looking for marijuana growing guides and books about medical cannabis? Then you should not miss our online bookstore with hundreds of books about cannabis, CBD, THC and more!

********
Grow guide for marijuana beginners.
- Advertisement -THC University

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Stay Connected

420FansLike
2,438FollowersFollow
420SubscribersSubscribe
- Advertisement -

Latest Articles