header image

[Sign Up Now] to Receive Our FREE Daily SCVTV-SCVNews Digest by E-Mail

Inside
Weather


 
Calendar
Today in
S.C.V. History
February 12
1879 - Mint Canyon School District organized (merged into Sulphur Springs Union in 1944) [story]
Mint Canyon School


By Nick Cahill

SACRAMENTO – Seeking a “tax holiday” to boost sluggish recreational marijuana sales, California lawmakers have reintroduced a bill that would temporarily lower taxes for the legal pot industry.

A bipartisan group of Assembly members said Monday that California should learn from other states that have legalized cannabis – including Washington state and Colorado – and simplify the tax system to encourage growers and sellers to join the legal market.

Assembly Bill 286 would lower the voter-approved state excise tax from 15 percent to 11 percent and eliminate a cultivation fee of $148 per pound of marijuana for three years.

Assemblyman Rob Bonta, D-Oakland, hopes the tax cut will soften the financial burden that has kept many growers operating on the black market since the Golden State began allowing recreational use in January 2018, and subsequently fill state coffers.

“Those good businesses, those good actors, are not able to compete with the black market product if they can’t be competitive on price and on cost,” Bonta said at a press conference. “By lowering the tax rate, you actually increase the tax revenue.”

California voters approved recreational marijuana use in 2016, with proponents painting legalization as a boon to both the economy and public safety. But more than one year into the switch, tax revenues have fallen nearly $100 million short of what the state predicted in its current budget.

Critics say the state’s tax scheme is too complex and that startup costs associated with opening a legal marijuana business have given the black market a decided edge.

State Treasurer Fiona Ma, who has previously advocated for a state-chartered cannabis bank, says for several years her office has been studying ways to get more marijuana businesses to pay their taxes.

Ma, a Democrat, says the common complaint from the industry is that state and local taxes are too high: She estimates that some California pot businesses are paying cumulative tax rates of up to 45 percent.

“This is the only industry where we are assessing high taxes at the front end [for startups], which is not a guarantee of success here,” Ma said. “We need to do better; this is anywhere from a $6-20 billion industry here in California.”

The coalition includes Republican Assemblyman Tom Lackey of Palmdale and Democrat Reginald Jones-Sawyer of Los Angeles, and it pushed for the same tax freeze last year. That bill, Assembly Bill 3157, was defeated in the appropriations committee and didn’t make it to the governor’s desk.

Bonta said that while he hasn’t talked with Gov. Gavin Newsom about Monday’s proposal, he believes the new governor would be open to it. Newsom was a major proponent of the 2016 legalization effort while he was lieutenant governor.

The California lawmakers are looking to Washington state, Oregon and Colorado, where cannabis revenues also started out slow but rebounded after lawmakers implemented tax reforms.

According to credit rating agency Fitch Ratings, Washington’s cannabis tax revenue totaled $13.4 million in the last month with its original tax system but jumped to $33 million less than two years later under the renovated tax framework.

The credit agency warned of the likelihood that California wouldn’t meet expected tax revenue estimates prior to legalization.

“California’s high taxes are likely to keep black market prices competitive into the long term. The state’s black market will also benefit from its long history as a supplier to states where nonmedical cannabis remains illegal,” Fitch Ratings predicted in a 2017 report.

Jones-Sawyer said that while there are more than 170 licensed marijuana businesses in Los Angeles, they are competing against 1,700 illegal ones which don’t pay taxes at all.

“We should have the most vigorous, vibrant cannabis business in the country, if not the world,” Jones-Sawyer said. “Ultimately we need to suppress the black market until it completely goes away.”

Comment On This Story
COMMENT POLICY: We welcome comments from individuals and businesses. All comments are moderated. Comments are subject to rejection if they are vulgar, combative, or in poor taste.
REAL NAMES ONLY: All posters must use their real individual or business name. This applies equally to Twitter account holders who use a nickname.

0 Comments

You can be the first one to leave a comment.

Leave a Comment


SCV NewsBreak
LOCAL NEWS HEADLINES
Wednesday, Feb 12, 2025
Feb. 22: Helen Hunt Jackson Returns to Rancho Camulos Reenactment
Experience Helen Hunt Jackson’s Jan. 23, 1882 visit to Rancho Camulos which inspired her to include this vestige of the Californio lifestyle as one of the settings for her novel Ramona.
Wednesday, Feb 12, 2025
Weather Alert: Prepare For And Stay Safe During Rainy Weather
The National Weather Service has issued a high-risk alert for significant road flooding and burn scar debris flows in areas recently affected by fires.
Wednesday, Feb 12, 2025
COC Foundation to Honor Marlee Lauffer with 2025 Silver Spur Award
The College of the Canyons Foundation has named Marlee Means Lauffer as the recipient of the prestigious 2025 Silver Spur Community Service Award in recognition of her longtime support of the college and community service in the Santa Clarita Valley.
Keep Up With Our Facebook

Latest Additions to SCVNews.com
Zignature, a Valencia based leader in meat-first, limited-ingredient dog food, recently launched its Employee Feed Alternative Giving Program.
Zignature Launches Employee Giving Program, Becomes Foundation’s First Sponsor
Experience Helen Hunt Jackson’s Jan. 23, 1882 visit to Rancho Camulos which inspired her to include this vestige of the Californio lifestyle as one of the settings for her novel Ramona.
Feb. 22: Helen Hunt Jackson Returns to Rancho Camulos Reenactment
The National Weather Service has issued a high-risk alert for significant road flooding and burn scar debris flows in areas recently affected by fires.
Weather Alert: Prepare For And Stay Safe During Rainy Weather
Connect with local business owners and industry leaders at 2025's second Business After Hours Mixer.
Feb. 19: Chamber Hosts After Hours Mixer at FastSigns Santa Clarita
The College of the Canyons Foundation has named Marlee Means Lauffer as the recipient of the prestigious 2025 Silver Spur Community Service Award in recognition of her longtime support of the college and community service in the Santa Clarita Valley.
COC Foundation to Honor Marlee Lauffer with 2025 Silver Spur Award
After the significant challenges due to the Palisades, Eaton, Hughes and other wildfires in the region, Assemblywoman Pilar Schiavo is working to ensure access to the vital resources needed now and in the months to come.
Apply for Disaster CalFresh and Receive Food Assistance Before February 19
A one-stop rebuilding shop established by Los Angeles County to help Eaton Fire survivors’ recovery efforts opened its doors this week and is now serving the public. 
L.A. County One-Stop Rebuilding Shop Now Serving Eaton Fire Survivors
Celebrate Valentine’s Day in the coziest way, bundled up at The Cube, Ice and Entertainment Center, Powered by FivePoint Valencia, for a romantic Sweetheart Skate.
Feb. 14: Glide Into Valentine’s Day Fun at The Cube’s Sweetheart Skate
Jersey Mike’s is hosting an all-day fundraiser, at all seven Santa Clarita Valley locations, for Carousel Ranch’s 11th Annual “Carousel Wishes & Valentine Kisses” Campaign.
Feb. 13: Jersey Mike’s All-Day Fundraiser for Carousel Ranch
The Master's University men's and women's golf teams began their spring season in the West Coast Classic, hosted by Lewis & Clark College at Victoria Club in Riverside Tuesday, Feb. 11. Both squads finished their respective tournaments in the middle of the pack, with the men's team finishing in sixth and the women's team finishing in fifth.
Mustangs Finish Mid-Pack to Begin Spring Season
The track and field teams for The Master's University stepped back on the line on Saturday, Feb. 8 at the Sunshine Open Invitational in Santa Barbara. Multiple school records fell and qualifying times were hit in the Mustangs' second meet of the 2025 indoor season.
Mustangs Blaze Bright at Sunshine Open
College of the Canyons women's tennis began Western State Conference play by claiming its first victory, a 5-4 result over visiting Ventura College on Tuesday, Feb. 11 at the Cougar Courts.
Canyons Earns First Win, 5-4 over Ventura
1879 - Mint Canyon School District organized (merged into Sulphur Springs Union in 1944) [story]
Mint Canyon School
The Los Angeles County Department of Public Health is reminding residents about the dangers associated with fire debris and issuing a Public Health Advisory for individuals residing within 250 yards of a burned structure or parcel within or near the Palisades and Eaton burn areas.
Public Health Advisory for Those Residing Near Burned Structures
The National Weather Service has issued a flash food watch for the Santa Clarita Valley on Thursday, Feb. 13. The watch is in effect from Thursday afternoon through Thursday night. Rain is expected throughout Southern California.
Feb. 13: NWS Issues Flash Flood Watch for SCV
The Master's University women's basketball team scored 28 points in the fourth quarter and held Benedictine Mesa to just 11 to come from behind and beat the Redhawks 70-58 Saturday, Feb. 8 in The MacArthur Center.
Big Fourth Quarter Gives Lady Mustangs the Win
The Santa Clarita Arts Commission Feb. 13 meeting agenda includes overviews of the 2026 Sidewalk Poetry project and city of Santa Clarita 2025 events schedule.
Feb. 13: Arts Commission Agenda Includes Sidewalk Poetry, City Events
The Master's University baseball team split a pair of games Friday, Feb. 7 with the Westcliff Warriors at Lou Herwaldt Stadium.
Mustangs Split Doubleheader with Warriors
College of the Canyons men's golf won a second straight conference tournament while seeing all five scoring players finish top-10 in the individual standings at River Ridge Golf Club in Oxnard on Monday, Feb. 10.
Canyons Wins Second Straight Conference Tourney
The Santa Clarita Valley Sheriff's Station is looking for the individuals who committed a residential burglary in Stevenson Ranch.
Stevenson Ranch Burglary Suspects Sought
The Federal Food and Drug Administration has announced Tri-Union Seafoods in El Segundo has made the decision to voluntarily recall select lots of canned tuna products sold under the Genova brand name in California.
Tri-Union Seafoods Issues Recall of Canned Tuna Due to Botulism Risk
Officers from the county of Los Angeles Department of Animal Care and Control will be conducting field animal licensing efforts in the unincorporated areas of Newhall (91381) in the Santa Clarita Valley beginning Wednesday, Feb. 26.
Feb. 26: Unincorporated Area of Newhall Targeted for Pet Licensing
The city of Santa Clarita has announced the release of the third episode of Santa Clarita Voices, the city’s official podcast that highlights the stories, experiences and conversations from city leaders, businesses and organizations.
Santa Clarita Voices Podcast Episode Three Released by City
Parks California and California State Parks have announced grants to 31 organizations throughout California, including the Fernandeño Tataviam Band of Mission Indians, totaling more than $1 million to improve access to state parks and create memorable nature experiences.
Parks Grant to Fernandeño Tataviam Band of Mission Indians
SCVNews.com