The November 8, 2016 passage of Proposition 64 “The Control, Regulate and Tax Adult Use of Marijuana Act” exempts certain sales of medical marijuana from sales and use tax.
Sales of medical cannabis to those who have a medical marijuana identification card (MMIC) issued on a county-by-county basis by the California Department of Public Health (CDPH) and a valid government-issued identification card are now exempt from sales and use tax. Consumers can obtain the CDPH-issued cards at their county health department, at a cost that varies by county. A paper recommendation from a physician is not sufficient to qualify for this sales tax exemption.
This county-issued MMIC will have the State of California seal and indicate whether the card holder is a “patient” or “caregiver.” The card will also contain the patient’s or primary caregiver’s photo, a nine-digit ID number, a CDPH website to verify the ID number, an expiration date, and the county that issued the card, as shown below. Cards are valid for the duration of the physician recommendation or up to one year, at which time the card must be renewed. Retailers should retain the purchaser’s nine-digit ID number and expiration date, along with the related sales invoice or other record of sale, to support the exempt sale.
Exempted products include medical cannabis, medical cannabis concentrate, edible medical cannabis products, and topical cannabis. These terms are defined in Business and Professions Code section 19300.5.
Retailers should not collect sales tax reimbursement on qualifying exempt sales of medical marijuana. They should claim a deduction on their sales and use tax returns for their qualifying exempt medical marijuana sales. Retailers may verify the validity of a nine-digit ID number on the CDPH website at www.calmmp.ca.gov.
Sales of recreational marijuana will not start until January 1, 2018. Such sales will be subject to sales tax and an excise tax. A cultivator tax will also apply to marijuana beginning on that date.
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1 Comment
That’s untrue…medical marijuana is now taxed. I voted against passing any of this….pot is going to be taxed 15% in 2018 and the medical pot is 7.5% to 9.75% but that is not considered tax compared to 15% add in you need the medical review appt. The letter and the card not covered by 90% of anyone’s insurance and the idiots that voted for this will now be looking at the possibility, of taxing all medicines and for those that don’t care and pay small co payments you are responsible for the total cost of the tax of the medication..which most medicines are hundreds of dollars to thousands that insurance picks up…either medical marijuana is medical and no tax or it just opened a can of worms to start a tax on all medicines. ..Obama allowed tax on medical prescriptions devices and now you are limited to one a lifetime like a wheelchair other wise you pay for most of the device and whether poor or rich it’s costly…because of recreational use of a drug like this and the government’s big hand in everything cancer patients have to pay tax and numerous fees. They should have left it alone now the idiot customer service employees are that much more stupid to king on their breaks…employees that ban marijuana after this law takes affect will be in for lawsuits for medical smoking versus recreational and medical should be allowed at ….bottom line the consumer will have to pay for the nonsense and the government gets rich and of course the tax money disappears.
Remember when you win a free new car you have to pay the tax and registration. .nothing is free and taxes are insane.