Fiona Ma for State Assembly

The Cannabis Safe Payment Act Would Simplify Tax and Fee Payments

The time for sensible cannabis tax legislation in California is long overdue. On Tuesday, Senators Scott Wiener (D-San Francisco) and Toni Atkins (D-San Diego) introduced a bill that would simplify the way cannabis businesses in California pay taxes and fees. The measure would allow cash payments at many more locations than are currently available. The bill was written in collaboration with Board of Equalization Chair Fiona Ma who is also sponsoring the bill.

Cannabis businesses would be able to make cash tax payments and fees to state agencies and local county tax collectors who are willing to participate. The bill would reduce the amount of time and travel distance that cannabis business owners.

“California’s cannabis industry is an important part of our economy, and a growing economic sector, particularly given the voters’ authorization of adult use of cannabis this past November,” Senator Wiener said in a statement. “We need to make it as easy and safe as possible for cannabis business owners to pay their taxes and fees, and we should not force them to drive hundreds of miles with a trunkful of cash just to comply with the law. In addition, with an incoming Attorney General in Washington D.C. who is hostile to cannabis, the relationship between the federal government and the cannabis industry may only get worse. While California can’t change the federal government’s dysfunctional treatment of cannabis, we can work to ensure that our business owners here in California can easily and efficiently comply with our laws in a safe and efficient manner. We can also do our best to compensate for the federal ban on cannabis businesses accessing banking services, and the Cannabis Safe Payment Act will do just that.”

The proposed measure would also allow counties to collect and remit payments, pending approval by the County Board of Supervisors and Tax Collector. The federal classification of cannabis under Schedule I makes credit payments to any banking institution virtually impossible. Since Proposition 215 was enacted in 1996, the Board of Equalization has collected sales and use taxes from cannabis businesses, entirely in cash. In California, there are currently only 22 BOE office locations statewide that cater to the nation’s most populous state. Under MMRSA, many cities, such as Sacramento, have a single location that accepts fee and tax payments for a number of state agencies. The Cannabis Safe Payment Act would solve several of these issues.