Politico: Weed Industry Pushes California Leg on Tax Freeze

Members of California’s cannabis industry met with state lawmakers Tuesday to renew their plea that the looming July 1 excise tax increase be postponed or cancelled.

Proponents of freezing the tax — which under current law will increase from 15 percent to 19 percent — pulled out all the stops, citing parents seeking cannabis products for their children's seizures and veterans with PTSD, among other groups that would be impacted.

“[They] shouldn't face an additional tax burden that forces them to choose between unaffordable regulated products or cheaper unregulated alternatives that may contain pesticides, heavy metals, or dangerous additives,” said Tiffany Devitt, chief of regulatory affairs at California-based cannabis company Groundwork Holdings, in a statement. “The state should be making safe cannabis more accessible, not less.”

Details: A letter sent by the industry was addressed to Democratic Gov. Gavin Newsom, Senate President Pro Tempore Mike McGuire (D), Assembly Speaker Robert Rivas (D), and key Democratic committee chairs Scott Wiener, Jesse Gabriel, Christopher Cabaldon, and Sharon Quirk-Silva. It was signed by representatives from major cannabis groups in the state, including the California Cannabis Operators Association, California NORML, and the California Cannabis Industry Association.

The letter’s authors wrote that they support Newsom’s budget proposal that would shift funding for illicit market enforcement from fees on legal operators to excise taxes, but asked that the state’s government also freeze the excise tax at 15 percent.

“Even a 1% differential in price can drive consumers away from the legal market,” the letter said, citing research from the Reason Foundation.

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