The California Department of Tax and Fee Administration has published general information relating to sales and use tax laws, cannabis tax law, and other programs. While these are broad brushstrokes, there are copious links to rules for specific regulations, making it a comprehensive, well-presented digital document.
The Tax Guide for Cannabis Business does not address regulations contained in other state and local laws. A touch of wry humor shines through the comment “for the Federal Government’s guidance regarding marijuana enforcement, refer to the U.S. Department of Justice website” with a link provided.
The General Layout of the Guide
The main index tabs relate to filing returns, making payments, taxes & fees, forms & publications, permits & licenses, tax rates, and knowing your rights. The getting started section provides essential information concerning registration, returns filing, account maintenance, and other related topics.
There are separate sections for cultivators, manufacturers, distributors, and retailers, plus a resources section that takes the reader to publications, special notices, statutory and regulatory information, web-based seminars, and access to help from customer service representatives.
An Important Disclaimer to Note
The guide informs it is nothing more than that, by stating:
“Please note that the general information provided is not intended to replace any law or regulation. This website summarizes the law and applicable regulations in effect when it was published. However, changes in the law or regulations may have occurred. If there is a conflict between this document and the law, decisions will be based on the law.”
Therefore, we advise always using a fresh-downloaded version and following the links provided to authority government sources. Newcomers should consider availing themselves of the offer of personal consultations at their place of business.
Two New Cannabis Taxes to Know
Two new cannabis taxes will apply from January 1, 2018, onwards in California.
- There will be a 15% tax on cannabis and cannabis products. Retailers must collect this, after calculating it based on the average market price of any retail sale, and pay it to their cannabis distributor.
- There will be a tax imposed on cultivators, based on harvested material that enters the commercial stream. They must pay this to their manufacturer or distributor as follows:
- $9.25 per dry-weight ounce of cannabis flowers that enter the commercial market
- $2.75 per dry-weight ounce of cannabis leaves that enter the commercial market
Distributors must collect the cannabis excise tax from retailers, and the cultivation tax from cultivators or manufacturers, as applies and pay it to the California Department of Tax and Fee Administration.
Further Information on the Guide
Follow this link to the complete Tax Guide for Cannabis Businesses in California.