Could Marijuana Taxes Rise Again?

Believe it or not, California’s cannabis industry could be looking at another tax increase this year.

On Jan. 1, the markup rate rose from 60% to 80%. That was a decision by the California Department of Tax and Fee Administration (CDTFA), which determines the rate on a biannual basis in six-month intervals. And that means it could raise the rate again in July.

Chris Coulombe, CEO of distribution company Pacific Expeditors, told Marijuana Business Daily that it could be a “coup de grâce” for the industry. And he expects it to happen.

“With retailers doing between a 100% and 300% increase in markup, arguably we’re going to see that tax level go above 100%,” Coulombe said.

There is some hope that the legislature will step in before this gets out of control. The industry is also looking toward a future of exports, which would expedite the need for a more palatable tax system to compete with states like Oregon.

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