NEWS & RESOURCES

“By stopping this misguided tax hike, the governor and Legislature chose smart policy that grows revenue by keeping the legal market viable instead of driving consumers back to dangerous, untested illicit products,” Amy O’Gorman, executive director of the California Cannabis Operators Association.

“By stopping this misguided tax hike, the Legislature recognized that smart policy grows revenue by keeping the legal market viable,” the organization said. “The passage of AB 564 proves that sound policy wins when state lawmakers listen to data over rhetoric.”

With the tax decrease taking effect on October 1st, cannabis buyers in California can expect to see lower prices in stores, potentially boosting the legal market.

Today, Governor Gavin Newsom signed legislation, Assembly Bill 564 (Haney), that eliminates a 25% tax increase on California’s legal...

Only 40% of cannabis consumed in California comes from licensed dealers, according to the state Department of Cannabis Control. Lawmakers, including the governor, argued that lowering the state tax would help stem closures and bankruptcies of legal businesses and help them regain enough of a foothold to compete with the illicit market.

Lawmakers gave final approval to the bill last week, sending the measure to the desk of Newsom, who has previously committed to signing it into law. The measure would drop the state excise tax on cannabis from 19% to 15% on Oct. 1 and maintain that tax rate until June 30, 2028.