Starting this summer, cannabis consumers in Santa Barbara will see higher taxes on non-medicinal purchases. To help with the city's budget deficit, the Santa Barbara council voted 5-2 on Tuesday to raise the tax rate for cannabis storefront and delivery retail to 8% from 6%.
The new rates will go into effect July 1.
Councilman Eric Friedman and Councilwoman Wendy Santamaria voted against the increase, saying they worried that it would lead to a decline in sales and hurt the local cannabis industry. "Ultimately, I think, based on the research, it would actually put more pressure on the industry, and we could exacerbate our deficit rather than actually addressing it," Friedman said.
The extra revenue from the tax increase is expected to bring in $125,000 to $300,000 each year and won't apply to legal, nonconforming medical dispensaries, of which the city has two.
Councilwoman Meagan Harmon supported the tax, saying it would only affect residents purchasing a "luxury recreational item." She also didn't think the increase was enough to drive down sales.
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