XPost: alt.california, talk.politics.guns, sac.politics   
   XPost: misc.taxes, alt.fan.rush-limbaugh   
   From: info@suse.org   
      
   California’s beleaguered pot industry was given another piece of bad   
   news Thursday afternoon: The state cannabis tax rate will increase from   
   15% to 19% on July 1, the highest allowed by state law.   
      
   The 26% change, devised by Gov. Gavin Newsom, is ironically being made   
   precisely because the state’s legal industry is floundering while the   
   illicit market thrives.   
      
   Representatives with the California Department of Tax and Fee   
   Administration announced the gross receipts tax hike during a cannabis   
   advisory meeting Thursday. State law requires the department to increase   
   the pot tax rate this year if cannabis excise revenue falls.   
      
   Jerred Kiloh, the president of the United Cannabis Business Association,   
   said the tax increase will only make it harder for legal stores to offer   
   cannabis at a price point that competes with illegal stores.   
      
   “More businesses will close sooner as the legal price is just too far   
   away from illegally obtained products. Less investment in starting or   
   continuing cannabis operations will occur, and demand for cannabis   
   licenses will decline exponentially,” Kiloh said.   
      
   Cannabis tax revenue has plummeted as the legal marijuana market goes   
   through a financial contraction, with thousands of companies going out   
   of business. Industry leaders have blamed the legal market’s struggles   
   on expensive regulations, high taxes and competition from the thriving   
   illicit market, which pays no cannabis taxes. A recent study funded by   
   the state found that the majority of cannabis users still purchase their   
   cannabis from the illegal market.   
      
   The tax increase is thanks to a law Gov. Gavin Newsom signed in 2022   
   that removed a cultivation tax but also required the state to increase   
   cannabis tax rates if revenues fall in the future. San Francisco   
   Assemblymember Matt Haney introduced a bill this year that would block   
   the tax hike. The bill is working its way through the Legislature and   
   unanimously passed its latest committee vote on April 24.   
      
   Amy O’Gorman Jenkins, the executive director of the California Cannabis   
   Operators Association, said in an email to SFGATE that cannabis   
   businesses already can’t afford to pay the 15% tax rate, let alone   
   operate under the impending tax increase.   
      
   “We’re urging the Legislature and Administration to act quickly and   
   freeze the tax at 15%. If we want a regulated market to survive in   
   California, the time to intervene is now,” O’Gorman Jenkins said.   
      
   https://www.sfgate.com/cannabis/article/california-cannabis-tax-   
   ncrease-20305768.php   
      
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