Taxes

California Prop 64 Explained

On November 8, 2016, the majority of California voters passed Proposition 64 – The Control, Regulate and Tax Adult Use of Marijuana Act. This means that all cannabis sales are subjected to three different taxes at retail. We want to make it clear for our customers and patients to see what taxes they are actually paying on cannabis. Our menu includes Excise Tax and Sales tax in our pricing. You may think that you’re paying more than before but with our deals and discounts it evens out for a lot of products. You may see other cannabis delivery services with lower prices but that means their menu prices do not include these taxes until checkout. Overtime, California cannabis taxes will get lowered. We just have to look at this as a privilege to be able to buy weed legally because years ago it was still very illegal. We are happy to serve our community and help people in need regardless.

15% Excise Tax

This 15% Excise Tax is paid by us upon orders accepted by our wholesale distributors. But with laws and rules changing every year, we actually pay a 27% Excise Tax when we buy products and then we must recollect a 15% tax on retail purchases. So a 15% tax is included in our pricing. This is paid back to the distributor when we buy new products and then the distributor pays that fee back to the state.

Sales Tax

Sales tax may vary from city to city. Livermore, Dublin, and Pleasanton have a 10.25% Sales Tax that is collected on retail sales. It is very important that we collect and pay this to the CDTFA on time because as a cannabis business we are subject to a 10% late fee and a 50% failure to pay fee, unlike normal businesses this is extremely high. It is not a problem for us though because we have been paying this on time for years.

Oakland 2.5% Tax

Because our city license and our office is held in Oakland, we must pay a 2.5% tax on sales at the end of the year. This tax rate is not included in our product pricing and we will pay this to the city at the end of each year. This way our prices are lower for our customers and patients.

Medical Marijuana Identification Card Program

In order to be excluded from paying Sales Tax on cannabis products you must get a MMICP card. You have to apply for it and almost no one does. A Medical Marijuana card that you can get online is not the same as this card. The California Department of Public Health’s (CDPH) Medical Marijuana Identification Card Program (MMICP) was established to create a state-authorized medical marijuana identification card (MMIC), along with a registry database for verification of qualified patients and their primary caregivers. Participation by patients and primary caregivers in this MMICP is voluntary. The MMICP web-based registry allows law enforcement and the public to verify the validity of a qualified patient or primary caregiver’s MMICP as authorization to possess, grow, transport, and/or use medical marijuana within California.

The advantages of a regular Medical Marijuana card (doctors recommendation) is that you can carry more cannabis on you. Up to 8 ounces of flower and more than 8 grams of concentrates. This also allows you to be 18 or older to buy cannabis instead of 21 or older at a recreational level. We highly recommend getting one of these cards so you can buy more products for yourself at a time. Sometimes we have great one ounce deals and maybe you want two. This can only be achieved with a Medical Marijuana card. We use GetNugg and for just the paper proof it’s only $39. You are also allowed to grow up to 6 plants at your house regardless of having a card or not.

Edible Limit

Due to Prop 64 laws passing it is now illegal to sell or purchase edibles that are over 100mg. We know, its ridiculous. But until these laws change we have to abide by them. We try to give the best deals possible as there is no limit on how many edibles you can buy at once. We have customers and patients that are fine with this limit but we also have people with very high tolerances due to chronic pain and they can eat up to 1000mg a day. One good thing though is that we can sell drinks and tinctures that are much higher in THC than 100mg.