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Taxing Medical Marijuana Growers

Sacramento, CA — After passing pot regulations last year, California lawmakers are now turning their attention to cultivators to boost state coffers.

The latest bill AB2243, passed Thursday by the State Assembly by a 60-12 vote, would create an excise tax on farmers. Democratic Assemblyman Jim Wood of Healdsburg whose similar tax proposal last year was killed at the last minute praised the legislation, stating, “An excise tax will ensure the revenue stays in the communities where the cannabis is grown.  Our goal is to create resources to manage the environmental and public safety problems we are battling.”

The bill would levy a $9.25 per ounce of marijuana flowers, $2.75 per ounce of pot leaves and $1.25 per ounce of immature pot plants tax.  That would result in $77 million annually for local police and environmental cleanup, according to legislative analysts.

Hezekiah Allen from the California Growers Association said, “AB 2243 is the right tax at the right time. This legislation will generate much needed revenue to clean up watersheds, prevent future environmental impacts, and protect the safety of our neighborhoods. Our communities and rivers can’t wait.” However, other marijuana activists oppose the taxes calling them unreasonably high, and arguing that the flower tax alone would cost farmers 10 percent of the marijuana’s value. Currently, local governments tax pot at about 7.5 percent.

Earlier this week, the Senate passed a 15 percent marijuana sales tax. Wood’s notes that if the bill has any chance of passing it will need to support from Republicans in the Senate.