In 50 days, Long Beach voters will decide whether to legalize medical marijuana within its borders, and California voters will determine if recreational marijuana should be permitted statewide.
While each initiative has its own set of taxes written into it, Long Beach is concerned the city wont capture enough tax revenue to properly regulate the marijuana industry should voters pass one or both of the citizen-backed ballot measures on Nov. 8.
So the city proposed Measure MA – a general tax that would fund city services related to public safety, 9-1-1 emergency response, police officers, regulation of the marijuana industry and homeless assistance programs.
The city believes that (marijuana) should be taxed appropriately so we have the resources to be able to meet all the needs, Mayor Robert Garcia said at a press conference on Monday.
Prior to Long Beach residents qualifying their own ballot initiative in July – Measure MM – the city spent nearly two years trying to write its own law regulating medical marijuana, but failed to reach a consensus.
The city estimates Measure MA would bring in $13 million annually should voters pass both the state measure, Proposition 64, and the local initiative. That is approximately $5 million more than is expected from Measure MM, which would not set taxes on recreational marijuana.
Measure MA would:
Establish a gross receipts tax of 6 percent on medical marijuana dispensaries, with an option for the council to increase the tax to a maximum rate of 8 percent;
Establish a gross receipts tax of 8 percent on the recreational sale of marijuana for adult use with an option to increase the tax to a maximum rate of 12 percent;
Establish a gross receipts tax of 6 percent on any Long Beach business that manufactures, tests, processes, distributes, packages or labels marijuana or cannabis-related products, medical or nonmedical, for wholesale to other retail marijuana businesses that sell those products to customers, with an option to increase the tax to a maximum rate of 8 percent.
Establish a tax of $12 per square foot of space dedicated to the cultivation of marijuana over the canopy area with an option to increase that tax to a maximum rate of $15 per square foot. This tax would also be subject to a Consumer Price Index increase.
Backers of Measure MM are concerned about overtaxing the medical marijuana industry, which the Long Beach Collective Association says will only drive up the cost of medicine for its patients.
Adam Hijazi, who sits on the board of directors for the collective, also expressed concerns that patients would be pushed into the black market should the industry be taxed too hard.
I know a vast majority of patients prefer to come into a dispensary where its safe, where they know its tested (in a laboratory), and people can advise them on what strain might be best for them, but the bottom line is if they cannot afford it, they will still have to go into illicit markets rather than the regulated market, he said.
Measure MM would:
Establish a gross receipts tax of 6 percent on medical marijuana dispensaries, with an option for council to reduce the tax in the future;
Establish a tax of $10 per square foot of space dedicated to the cultivation of marijuana;
Establish a minimum annual tax of $1,000 for all dispensaries and cultivators.
We definitely are trying to promote regulation that does bring in tax revenues for the city; that is our goal as well, Hijazi continued. We just want to strike that balance between raising revenues and making sure the ordinance is successful. We want to be able to get it right.
Both measures would need more than 50 percent of the votes cast to be enacted. In addition, Measure MA would need more votes than Measure MM for its tax structure to take precedence.
For more information on Measures MM and MA, including arguments for and against each measure, visit the city website at Ballot Measure Information.
News Moderator: Katelyn Baker
Full Article: How Long Beach Wants To Tax Marijuana If Its Legalized In November
Author: Courtney Tompkins
Contact: (562) 435-1161
Photo Credit: Tanjila Ahmed