Cannabis Tax Revenue Increases In 2nd Quarter of 2018

Author: California Department of Tax and Fee Administration
Published: Aug 15, 2018
Sacramento, California

Sacramento – The California Department of Tax and Fee Administration (CDTFA) today released revenue numbers for cannabis sales for the 2nd quarter of 2018. Tax revenue from the cannabis industry totaled $74,240,257.00 million from April 1, 2018, through June 30, 2018, which includes state cultivation, excise and sales taxes. It does not include tax revenue collected by each jurisdiction.

California’s excise tax on cannabis generated $43,490,668.00 million in revenue during the second quarter of calendar year 2018. The cultivation tax generated $4,482,119.00 million, and the sales tax generated $26,267,470.00 million in revenue. Medicinal cannabis is exempt from sales tax if the purchaser holds a valid Medical Marijuana Identification card.

The revenue from 1st quarter 2018 was $60.9 million, which included $32 million in excise tax, $1.6 million cultivation tax, and $27.3 million in sales tax.

To better serve our taxpayers, CDTFA has opened a new satellite location to accommodate tax and fee payers in and around Humboldt County, created a cannabis external tax advisory group, introduced a new pilot project in which the Statewide Compliance and Outreach Program (SCOP) teams visit known cannabis retailers to educate and assist them in complying with their tax obligations, and implemented improved procedures and security measures for financial transactions.

In November 2016, California voters approved Proposition 64, the Control, Regulate and Tax Adult Use of Marijuana Act. Beginning on January 1, 2018, two new cannabis taxes went into effect: a cultivation tax on all harvested cannabis that enters the commercial market and a 15 percent excise tax on the purchase of cannabis and cannabis products. In addition, cannabis and cannabis products are subject to state and local sales tax at the time of retail sale.

To learn more, visit the Tax Guide for Cannabis Businesses on the CDTFA website.

Note: This news release may discuss complex tax laws and concepts. It may not address every situation, and is not considered written advice under the relevant Revenue and Taxation Code section for the tax or fee program listed above. Changes in law or regulations may have occurred since the time this news release was written. If there is a conflict between the text of this news release and the law, decisions will be based upon the law and not this news release. For specific help, please contact the CDTFA at 1-800-400-7115.

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