SB 94, Trailer Bill the “Medicinal and Adult-Use Cannabis Regulation and Safety Act” amended Revenue and Taxation Code Section 34012 so that effective January 1, 2018, there is a cultivation tax imposed on the cultivators on all harvested cannabis that enters the commercial market.
The tax shall be due after the marijuana cannabis is harvested and enters the commercial market.
(1) The tax for cannabis flowers shall be nine dollars and twenty-five cents ($9.25) per dry-weight ounce.
(2) The tax for cannabis leaves shall be set at two dollars and seventy-five cents ($2.75) per dry-weight ounce.
The State Board of Equalization may adjust the tax rate for cannabis leaves annually to reflect fluctuations in the relative price of cannabis flowers to cannabis leaves.
The cultivator is responsible for the payment of the cultivation tax. The distributor will collect the cultivation tax from the cultivator upon entry of the cannabis into the commercial market. This does not apply when harvested cannabis is sent directly to a manufacturer. In that case, the manufacturer will collect the cultivation tax from the cultivator on the first sale or transfer of unprocessed cannabis by the cultivator to the manufacturer. The manufacturer is responsible for remittance of the cultivation tax collected on the cannabis product sold or transferred to a Distributor for quality assurance, inspection, and testing. All cultivation tax applicable to a unique identifier shall be paid upon the first sale or transfer of cannabis or cannabis product with an associated unique identifier.