Pot Taxes Are Coming To California

Despite last week’s defeat of Proposition 19 at the polls, new taxes on marijuana are coming to California.

As I write today in High Times online, California voters on election day by wide margins endorsed citywide medical marijuana tax ordinances in Albany, Berkeley, La Puente, Oakland, Rancho Cordova, Richmond, Sacramento, San Jose, and Stockton. You can read the full details of each of these tax measures, as well as Los Angeles’ latest medi-pot tax plan, here.

While the bulk of these new tax plans impose fees on the dispensaries themselves — fees that will no doubt indirectly be passed on to the consumer via higher retail prices for cannabis — at least one plan (Rancho Cordova’s Measure O) seeks to impact patients directly by instituting local fees on personal home grows.

While it is possible (read: likely) that this exorbitant fee will be eventually struck down by the courts as an undue infringement upon patients’ rights under Prop. 215, it could be months or years before such a clarification by the courts is made.

Patient advocacy groups like Americans For Safe Access oppose the implementation of such medi-tax laws, noting that they could unduly raise the already inflated black market price of medical cannabis, lead to fewer dispensaries, and ultimately limit patients’ access. Nonetheless, it is hardly surprising to see a majority of Californians, at a time of record budget deficits, voting to impose additional taxes upon a minority subset of their community.

In short, the success of these tax measures at the ballot box is yet further evidence that with or without Prop. 19, more and more city governments — rightly or wrongly — are going to be looking at new ways to raise revenue from California’s burgeoning cannabis industry and its consumers. Industry insiders and those they represent, patients especially, would be best advised to begin playing an active role in their local politics, or else risk suffering the consequences of unreasonable taxation without representation.

You can read my full thoughts on this developing issue, and comment on it, by clicking here: Like It Or Not, Pot Taxes Are Coming to California.

29 thoughts

  1. Evade the tax until it’s legalized. Better yet, propose a law that the government can’t tax things that are prohibited.

  2. This whole thing is one giant clusterf*ck, please excuse my French.

    You would think in good ol’ “Live Free of Die” New Hampshire where I reside, we could do this right. We are much smaller than California, and I think groundbreaking legislature is more manageable. Due to free-staters and a largely independent thinking general populace, we tend to be rated fairly libertarian. I argue that we are certainly free thinkers; we generally vote red, but we have legalized same-sex marriage.

    Alas, we have a 4th term Democratic governor who vetoed the most restrictive medical marijuana bill ever written, despite tending to Gov Lynch’s every requirement prior to supposed signing. And now we have a Republican dominated state senate, and not the good libertarian (likely pro-legalization) kind of republicans, the uber neocons.

    So much potential… but absolutely not realistic.

    Where will we legalize Marijuana in 2012? I truly believe the best and only way to do so is via the states, not the federal government. We need to do it in a state where there at least isn’t a huge grey market like California.

    And most of all, we need to head Ron Paul’s advice, like him or not: Bill’s should be simple, no more than one page.

    It should read something like this, only obviously with technical legal jargon, but still only one page:

    Marijuana will be subject to normal sales taxes.
    You must be 21 to purchase and consume marijuana. The penalty for underage use will mirror Alcohol.
    All other usages, penalties, point of sale requirements, driving infractions, and personal production mirrors current Alcohol legislation.

    Boom done.


  3. Well the taxes better be fair, if you hike the rate high enough you can run a lot of these dispensaries out of business.

    When that happens people will go back to slightly more affordable illegal weed and the medical voters who opposed 19 will wish they hadn’t.

  4. Holy Smokes. It is the role of government to tax commerce. They are just doing their job. Once they get the taste of the sows sweet milk they will never leave the teat. Cute little piglets suckling from the sow.


  5. I think the taxation of our medicine is a mistaken cultural precedent. I voted in favor of prop-19 because I felt freedom from incarceration for all adult users was the highest priority even though it wasn’t in my best interest as a card-carrying medicinal user. 19 got us talking and for that, we owe a debt of gratitude to Mr. Lee and his group. I hope that we’re able to come up with a proposal for 2012 that builds on our strengths and those of cannabis to bring its taxable use onto Main Street and its medicinal users the tolerance and eventually the respect accorded to the patients using other botanicals and pharmaceuticals.

  6. most people are concerned about the latest football game a quote from part of the movie rather than what are elected officials are doing we have only ourselves to blame they the politicians notice and they will continue with this behavior until the citizens show concern

  7. The failure of CA Prop 19 to pass in November’s mid-term election might be a blessing in disguise — an opportunity to not only address such issues as (a) large scale commercialization versus Mom & Pop boutique providers, (b) standardization of regulations state-wide, and (c) reining-in arbitrary & capricious law enforcement, but to also provide a demonstrable economic benefit to both the State and people of California.

    Prop 19 represented not only the attempt of a State’s citizens to re-legalize a plant long wrongfully maligned, but also an attempt to reassert a State’s economic prerogatives in direct opposition to an overbearing and tyrannical Federal mindset. Constitutionally, States Rights should trump Federal powers in virtually every aspect excepting national defense and international trade — the Commerce Clause has been twisted into a Machiavellian pretzel totally inappropriate to intrastate commerce.

    Nothing could be more representative of States Rights than a States ability to exercise options beneficial to its people and its ability to control its financial viability. One of those things is the ability to create a publicly owned not-for-profit State Bank, through which all monies related to State business might flow. The re-legalization of cannabis (& hemp) is one financial stimulus (new jobs, new industries, new tax revenues) that not only would require virtually no new public debt to initiate, but could also provide a tax escrow haven for cannabis-related intrastate business, including funds that would (if not illegal) be directed back to the Federal government, e.g. the IRS.

    As it is, the State needs more money, which must now be borrowed at interest from private sources through bonds. Regional and Federally represented private banking interests do not necessarily re-invest all intrastate funds accrued to intrastate financial needs (aka community reinvestment) — a publicly owned not-for-profit State Bank could be chartered to do only that. There is a precedent for the creation of such a financial institution — one need only look at North Dakota, with not only the lowest unemployment rate in the nation, but one of the few states not in severe fiscal distress. I doubt that this is mere coincidence. States Rights, expressed not only in a re-affirmation of individual rights & civil liberties without government meddling via re-legalizing cannabis (& hemp), but also a new public fiscal institution created for the greater public good, funded by a rising new cannabis industry — what’s not to like about that?

  8. Medical marijuana will only be used by those who are well-to-do. The majority of medical marijuana patients, the middle-class and poor, will resort to the black market, to obtain the same substance at a sizable discount, and the drug war will continue as always. The more things change, the more they stay the same, sometimes.

  9. califirnia had thier chance to lead the nation and be the first to profit from a new industry.They let fear and greed stop them. personaly i hope they tax them to the point they have to go back to the black market. also colorado and washington look like good places to try in 2012 leave califonia to thier own greed

  10. I love MPP is trying to gear up and get people excited about trying in places like Arkansas where Medical Marijuana won’t pass for YEARS

    yet NOBODY is talking about Connecticut & Dan Malloy who WILL sign a medical marijuana bill into law. I know Connecticut is a small state, but what gives? The goal is to reach 26 states by 2012… if that’s so why NOT spend some time focused on CT?

    NORML– I’d love to see a response from you about Connecticut. Also– I heard in CT there *is* a medical marijuana law on the books, but it requires an actual perscription and an additional statute removes the license from any physician who writes the script… any truth to that?

    [Paul Armentano responds: Several New England states will be in play, including New Hampshire, Rhode Island, and Connecticut. Various reform groups, likely DPA specifically, will no doubt be spending resources in Connecticut. Yes, Connecticut is one of a number of states with statutory language on its books regarding medical marijuana, but the law is moot because it conflicts with the federal protocols of licensed physicians.]

  11. If you are able…and a stoner4life…then maybe some of us(myself included); should move to CO./WA. to help the vote in a couple yrs…???

    2 cents: I think only recreational cannabis should be taxed….not medical.

  12. What about the privacy issue? Are growers going to have to let random government people come into their homes just to verify that they’re paying taxes on their house plants?

    [Editor’s note: The taxation envisioned in some of these CA cities is at the retail level and not trying to tax individual growers’ plants.]

  13. Re #2,

    You’re so dramatic. When’s the last time you paid $1200.00 for a bottle of taxed Johnny Walker? Right now, MJ is illegal–and untaxed–and the prices are outrageous.

  14. If Prop 19 had passed, would personal-grows STILL be facing taxation?
    (i.e., in manner of Rancho Cordova’s “Measure O”).
    I think NOT.

    Under what fell under 6 percent short-of-passage by a majority of California voters…
    Personal, non-commercial home-grows would have been “just like tomatoes”
    within the 25 sqr-ft limit, neither requiring a grow-license NOR incurring tax-liability…
    But NOoo!!! (on Prop 19), is what happened instead.

  15. #14 Mark Says:
    November 11th, 2010 at 7:47 am

    “New issue of Time Magazine is out today with a joint on the front cover!!! Amerijuana!!”

    RE: Mark
    Big F-ing deal!!!
    That Slime-Magazine article is NOT affirming the VALIDITY
    of Medical Cannabis…precisely the opposite…
    (Article is not so subtly “laced” w/ “dope-scare” propaganda, “minimizing” the helpful role cannabis serves for those with genuine need for the compounds that ONLY THIS botanical provides!!!).

    May the author, (Andrew Ferguson), of that news-article experience 1000 times the pain I have AND be given the most toxic “LEGAL”, synthetic meds there are as “relief”,
    As payback for DERIDING the wrongfully maligned BLESSED BOTANICAL!!!




  16. No taxation without representation! The resulting tax money will go toward further opression rather than regulation and protection of the free market.


  17. Texas has a bill to be voted on next year. My college NORML chapter at Sam Houston State (in the process of subitting official application to NORML) has nearly 160+ supporters and will be making a move next year to support the bill in Austin.

    NORML- We’d sure like to talk to you guys about officiation and coordination henceforth. We have a seemingly strong backing in this deep East Texas, prison central, college town. Please let me know if you’re interested in contact me.

    NORML Kats

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