Shopping for your medicine should be a relaxing and soothing part of any healing process, and it’s especially true with cannabis. A pleasant surprise, like a new strain or an edible in a favorite flavor, would be welcome and appreciated. No one, however, wants a surprise from the tax man in the form of sticker shock. And a new medical marijuana tax act is officially on the table in California.
Medical Marijuana Tax Might Become 15% Higher
California NORML, the state advocacy group for the reform of marijuana laws, has announced it’s opposition to Senate Bill 987 introduced by Senator Mike McGuire. This bill, otherwise known as The Marijuana Value Tax Act, if passed, would impose an additional 15% sales tax on the sale of medical marijuana in any retail setting, such as a dispensary or collective. Senator McGuire had this to say about the bill:
“We made a commitment last year as we were working through the huge undertaking of setting statewide regulations for medical marijuana that we would follow up on a statewide excise tax,” Senator McGuire said. “This needed revenue will make our communities stronger by focusing on the impacts of cultivation and use of marijuana, including funding local law enforcement and neighborhood improvement programs, state parks, drug and alcohol treatment and environmental rehabilitation.”
Last year, Senator Mike McGuire passed SB 643 – The Medical Marijuana Regulation and Safety Act – that was part of a historic three-bill package covering every aspect of the commercial medical marijuana industry which will be regulated and subject to licensure in California.
His latest bill, SB 987, creates a tax that would be the responsibility of the purchaser, and is based into the price of marijuana. It would amount to a 15% price increase across the board on any form of medical marijuana. Under SB 987, 30% of all revenue from the MVT will go to the Bureau of Medical Marijuana Regulation to distribute via grant programs designed specifically for local agencies who oversee the regulation of cultivation, processing, manufacturing, distributing and sale of marijuana.
California NORML director Dale Gieringer is quoted on their website as saying “At this time when providers already face burdensome new costs under the Medical Marijuana Regulation and Safety Act it is unwise and unfair to impose any new state tax on medical marijuana.” Gieringer goes on to state that he believes further taxes will “only encourage marijuana suppliers to move to the illegal, untaxed, unregulated adult use market.”
Suppliers moving out of the legitimate medical marijuana industry could have an impact on patients who rely on legitimate suppliers. Limited choices, higher prices and supply shortages are the economic realities of fewer suppliers in a market like this one. Coupled with the automatic 15% sales tax which is proposed, these concerns make Senate Bill 987 a non-starter for California NORML.
A medical marijuana tax in California could become very real. Concerned patients should contact their senator.