This Bill would bring the rate back to 15% and delay the requirement to adjust it until the 2030-31 fiscal year.
Supporters say it would help an industry that’s already struggling to compete with illegal markets. The State Department of Cannabis Control estimates that about 60% of cannabis consumed in California is bought illegally.
Zoe Schreiber is the Vice President of Policy for the California Cannabis Industry Association. She worries the tax hike will only continue to drive customers away at a time when legal sales are low and licensed businesses are hurting.
Schreiber says “We have more inactive and closed licenses than we have active since the beginning of this industry in California, so there’s not a healthy industry to begin with, to really serve the needs of consumers within the state.”
Critics of the Bill say the tax revenue is necessary to fund programs like substance abuse education and child care, but Schreiber says an increase could actually hurt tax collections in the long run.
Schreiber says ”We can’t come through on that without the ability to create a marketplace that incentivizes and brings consumers in to have safe regulated cannabis.”
Governor Gavin Newsom has expressed support for the bill.
