Capitol Weekly: Bill to suspend California cannabis tax advances

EXCERPT:

When voters approved Proposition 64 in 2016 to legalize the personal use of marijuana, it almost seemed like a foregone conclusion that someday California would emerge as an economic power within the burgeoning cannabis industry.

The state, after all has been synonymous with weed since the 1960s.

Reality, however, has harshed that hopeful buzz as California’s legal pot businesses have floundered under heavy red tape while illegal operators have prospered.

In fact, illicit sales today account for an estimated 60 percent of the state’s overall marijuana market, putting legal operators at a distinct advantage and giving other states, like Michigan, an opportunity take the lead in a market that’s expected reach $76 billion nationwide by 2030.

In an attempt to turn the tide, Assemblyman Matt Haney, D-San Francisco, has authored legislation to take some of the pressure off of California’s legal cannabis operators.

AB 564 seeks to suspend an increase of the excise tax on cannabis, from 15 to 19 percent, which is scheduled to take effect on July 1.

“If we continue to pile on more taxes and fees onto our struggling small cannabis businesses, California’s cannabis culture is under serious threat of extinction,” Haney said in a press release. “Instead, we should be looking at how we can support this industry which has barely been given a chance to survive after legalization. If we want to support our cannabis industry that drives millions of visitors to California every year, adding more costs makes absolutely no sense.”

The bill is sponsored by California NORML, the United Food and Commercial Workers Western States Council, the California Cannabis Industry Association, the California Cannabis Operators Association, the United Cannabis Business Association and the Origins Council, who say that a tax increase now will just send consumers away from the regulated market to illegal operators where they can purchase marijuana at a fraction of the price.

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