US (CA): Cannabis tax revenue are going high

The sale of cannabis in California went legal in 2016, and retailers were able to open their doors two years later. Along with the legal retail sale of cannabis came two new taxes — a cultivation tax on all harvests and an excise tax on the purchase of weed and products made with it; the usual sales taxes, both state and local, also applied. They add up, and in the third quarter of 2020, California’s total cannabis tax revenue was $306.7 million. Of that amount, the state gained sales and excise tax on $11 million worth of retail cannabis sold in cities in Santa Barbara County.

For $30 worth of cannabis flower, or buds, the taxes can raise the consumer’s payment to $41.77, the state Tax and Fee Administration calculated. That includes a 15 percent excise tax, a 10 percent cannabis business tax, and the state’s 8.5 percent sales tax. The cultivation tax is part of the retail price as it is paid by weight when the farmer sells to a distributor.

The breakdown of the $306 million in taxes are excise tax of $159.8 million, cultivation tax of $41 million, and sales tax of $105.9 million. For the previous year’s July to September, the cannabis taxes to the state were $170.8 million.

Read more at independent.com


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