Tax, Regulations & Rights!
Los Angeles Cannabis Retail Tax Breakdown:
– Sales Tax – 9.5% (Exempt with MMIC)
– State Excise Tax – 15%
– City Measure M Tax – 5% (18+ w/ Dr. Rec) or 10% (21+)
Total Tax Rate for Recreational Cannabis Sales (21+) = 34.5%
Total Tax Rate for Medical Cannabis Sales (18+ w/ Dr. Rec) = 29.5%
Total Tax Rate for Medical Cannabis Sales (18+ w/ MMIC are Sales Tax Exempt) = 20%
Table of Contents (click any question to navigate):
What is Proposition 215?
The California Compassionate Use Act, was enacted by the voters and took effect on Nov. 6, 1996 as California Health & Safety Code 11362.5. The law makes it legal for patients and their designated primary caregivers to possess and cultivate marijuana for their personal medical use given the recommendation or approval of a California-licensed physician.
What is SB420?
A legislative statute, went into effect on January 1, 2004 as California H&SC 11362.7-.83. This law broadens Prop. 215 to transportation and other offenses in certain circumstances; allows medical marijuana patients to form medical cultivation “collectives” or “cooperatives”; and establishes a voluntary state ID card system run through county health departments. SB 420 also establishes guidelines or limits as to how much patients can possess and cultivate. Legal patients who stay within the guidelines are supposed to be protected from arrest.
What is MAUCRSA?
The Medical Cannabis Regulation and Safety Act (MCRSA) was established through a series of bills passed by the California State Legislature in 2015 and 2016. The Control, Regulate and Tax Adult Use of Marijuana Act (AUMA) was established with the passage of Proposition 64, a voter initiative, in November 2016. The AUMA legalized the nonmedicinal adult use of cannabis. It also established California’s framework for the licensing, regulation, and enforcement of commercial non-medicinal cannabis activity. In June 2017, the California State Legislature passed a budget trailer bill, Senate Bill 94, that integrated MCRSA with AUMA and created the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA). (Bus. & Prof. Code, § 26000 et seq.)
Under MAUCRSA, a single regulatory system will govern the cannabis industry (both medicinal and adult-use) in California. Under MAUCRSA, the Bureau is charged with the licensing, regulation, and enforcement of the following types of commercial cannabis businesses: distributors, retailers, microbusinesses, temporary cannabis events, and testing laboratories.
On January 1, 2018, the Bureau began issuing licenses for medicinal and adult-use cannabis activities relating to retail, distribution, microbusiness, testing laboratories, and cannabis events. These licensed commercial cannabis businesses are in operation under the emergency regulations adopted on December 7, 2017 and readopted on June 6, 2018.
Watch this informational video from CDPH about how MAUCRSA regulations affect the end consumer.
How am I protected?
Under California law and the MAUCRSA, adults 21 or older can use, carry, and grow cannabis (marijuana, weed, pot). Legal limit for growing cannabis recreationally is 6 plants on private land. To buy medical cannabis, you must be 18 or older and have either have current physician’s recommendation, a valid county-issued medical marijuana identification card, or be a Primary Caregiver as defined in Health and Safety Code Section 11362.7(d). You can consume cannabis on private property but you cannot consume, smoke, eat, or vape cannabis in public places. Property owners and landlords may ban the use and possession of cannabis on their properties. Even though it is legal under California law, you cannot consume or possess cannabis on federal lands like national parks, even if the park is in California. It is illegal to take your cannabis across state lines, even if you are traveling to another state where cannabis is legal.
Prop. 215 explicitly covers marijuana possession and cultivation (H&SC 11357 and 11358) for personal medical use. Hashish and concentrated cannabis, including edibles, (HSC 11357a) are also included. Transportation (HSC 11360) has also been allowed by the courts.
Within the context of a bona fide collective or caregiver relationship, SB 420 provides protection against charges for possession for sale (11359); transportation, sale, giving away, furnishing, etc. (11360); providing or leasing a place for distribution of a controlled substance (11366.5, 11570).
What illnesses are legally covered for medical marijuana use?
Prop. 215 lists “cancer, anorexia, AIDS, chronic pain, spasticity, glaucoma, arthritis, migraine, or any other illness for which marijuana provides relief. Physicians have recommended marijuana for hundreds of indications, including such common complaints as insomnia, PMS, post-traumatic stress, depression, and substance abuse.
Who qualifies as a physician?
Prop. 215 applies to physicians, osteopaths and surgeons who are licensed to practice in California. It does not apply to chiropractors, herbal therapists, etc. See a list of medical cannabis specialists. Prop. 215 requires physicians to state that they “approve” or “recommend” marijuana. A recommendation is valid so long as the doctor says it is. However, SB420 requires ID cards to be renewed annually and many police refuse to recognize recommendations that are older than a year or so. Physicians are protected from federal prosecution for recommending marijuana by the Conant U.S. court decision.
Who is allowed to grow marijuana?
Under MAUCRSA, if you are 21 or older, you can plant, cultivate, harvest, dry, and process up to six cannabis plants in your private residence or on the grounds of your residence. If you are growing cannabis, the plants must be in a locked space that is not visible to the public. Cities and counties may prohibit the outdoor cultivation
of cannabis. It is against the law for you to use a volatile solvent for the manufacture of concentrated cannabis for your own personal use.
Medical patients with a physician’s recommendation and their primary caregivers, defined as, “The individual designated by the person exempted under this act who has consistently assumed responsibility for the housing, health, or safety of that person.” According to a state supreme court decision, People v Mentch (2008), caregivers must supply some other service to patients than just providing marijuana.
Although Prop. 215 allows patients to grow their own medicine, landlords are not legally obliged to allow it. Many cities and counties have passed zoning ordinances that restrict where patients can grow, in some cases outlawing outdoor cultivation altogether. See local policies.
As an alternative, SB 420 allows patients to grow together in non-profit “collectives” or cooperatives. Collectives may scale the SB 420 limits to the number of members, but large gardens are always suspect to law enforcement. In particular, grows over 100 plants risk five-year mandatory minimum sentences under federal law. Many local governments have moved to ban or sharply restrict the right of patients to grow collectively. Policy varies greatly around the state (see local limits below.).
How much cannabis can I have?
Under MAUCRSA, if you are 21 or older, you can buy and possess up to one ounce (28.5 grams) of cannabis and up to eight grams of concentrated cannabis (separated resin, whether crude or purified, obtained from cannabis). You can only buy cannabis at retail outlets licensed by the California Bureau of Cannabis Control. Although you can legally possess cannabis, it is illegal for you to sell it without a license. You can give up to one ounce (28.5 grams) of cannabis and up to eight grams of concentrated cannabis to a person 21 or older, but you cannot receive money or any form of compensation.
Under Prop. 215, patients are entitled to whatever amount of marijuana is necessary for their personal medical use. However, patients are likely to be arrested if they exceed the SB 420 guidelines. SB420 sets a baseline statewide guideline of 6 mature or 12 immature plants, and 1/2 pound (8 oz.) processed cannabis per patient. Individual cities and counties are allowed to enact higher, but not lower, limits than the state standard. See local limits.
In a state Supreme Court ruling, People v. Kelly (2010), the court held that patients can NOT be prosecuted simply for exceeding the SB 420 limits; however, they can be arrested and forced to defend themselves as having had an amount consistent with their personal medical needs. Patients can be exempted from the limits if their physician specifically states that they need more; but beware of physicians who charge extra for “cultivation” licenses for large amounts. The validity of recommendations for specific plant numbers is doubtful.
Is it possible to be arrested?
Yes, unfortunately. Cannabis remains classified as a Schedule I drug under the federal Controlled Substances Act, and its purchase, possession, distribution, or use within California may be unlawful under federal law. While it is our intention to provide current information, this fact sheet is not for the purpose of providing legal advice and can become outdated. Contact your attorney if you have questions about cannabis, what is (or is not) legal under state or federal law or need legal advice.
Many legal medical marijuana patients have been raided or arrested for having dubious recommendations, for growing amounts that police deem excessive, on account of neighbors’ complaints, etc. Once patients have been charged, it is up to the courts to pass judgment on their medical claim.
A landmark State Supreme Court decision, People vs. Mower, holds that patients have the same right to marijuana as to any legally prescribed drug. Under Mower, patients who have been arrested can request dismissal of charges at a pre-trial hearing. If the defendant convinces the court that the prosecution hasn’t established probable cause that it wasn’t for medical purposes, criminal charges are dismissed. If not, the patient goes on to trial, where the prosecution must prove “beyond a reasonable doubt” that the defendant is guilty.
Can I be charged federally?
Under the U.S. Controlled Substances Act, possession of any marijuana is a misdemeanor and cultivation is a felony. A Supreme Court ruling, Gonzalez v Raich (June 2005), rejected a constitutional challenge by two patients who argued that their personal medical use cultivation should be exempt from federal law because it did not affect interstate commerce. Despite this, federal officials have stated that they will not go after individual patients.
Medical marijuana patients are not protected while on federal park land or forest land in California.
Should I get a state issued medical marijuana ID card (MMIC)?
Since the passing of the MAUCSRA and implementation in 2018, there are benefits to having a CA physician issued medical marijuana recommendation.
If you are a medical marijuana patient and also have a state issued MMIC card, your taxation on cannabis product will be waived for CA sales tax and local cannabis tax. That’s 20% versus 34.5% in taxes!
Recreational users and cannabis patients are not required to get an ID card to enjoy the protection of Prop. 215, but a state card can provide an extra measure of protection against arrest. Patients and caregivers can obtain state ID cards through the health departments of the county where they live (except Sutter and Colusa). The state ID card system has safeguards to protect patient privacy. Police and employers cannot track down patients through the registry.
Where can I use marijuana?
You can use cannabis on private property. But you cannot use, smoke, eat, or vape cannabis in public places and you cannot smoke cannabis or cannabis products in places where it is illegal to smoke tobacco. Property owners may ban the use and possession of cannabis on their privately owned properties. You cannot use cannabis within 1,000 feet of a school, day care center, or youth center while children are present. Even though cannabis is legal under California law, you cannot consume or possess cannabis on federal lands like national parks, even if the park is in California. The cultivation, possession, sale, and use of cannabis in California may remain unlawful under federal law.
Can I sell any extra medicine I have?
Although you can legally possess cannabis if over the age of 21, it is illegal for you to sell it without a license issued by the California Bureau of Cannabis Control. You can give up to one ounce (28.5 grams) of cannabis and up to eight grams of concentrated cannabis to a person 21 or older, but you cannot receive money or any form of compensation.
Can my employer decide to drug test me?
The California Supreme Court has ruled that employers have a right to drug test and fire patients who test positive for marijuana, regardless of their medical use (Ross v RagingWire, 2008). Some employers will excuse patients if they present a valid 215 recommendation or state issued MMIC. Others won’t. Marijuana use is never permitted in jobs with federal drug testing regulations, such as the transportation industry.
Can I grow or use marijuana with children in the house?
It is legal for adults 21 or older to possess, consume and cultivate cannabis (marijuana, weed, pot) in California but it is illegal for anyone under 21 to smoke, consume, buy or possess cannabis (unless they have a current qualifying physician’s recommendation or a valid county-issued medical marijuana identification card and are 18 years of age or older).
Consuming cannabis (marijuana, weed, pot) can affect the health of your baby and is not recommended by the CDPH for women who are pregnant or breastfeeding, or who plan to become pregnant soon.
While it is not illegal to safely store cannabis on the same premises as a minor, there have been cases when Child Protective Services has become involved, mostly in cases with large plant numbers, evidence of sales, neglect, or messy divorce proceedings.
Be responsible! Make sure that you don’t leave edibles around where kids can get them, and keep gardens away from where they play. Lock up your stash and take advantage of the child resistant packaging for all cannabis products provided in the regulated market.
Knowledge is power, especially for your children. Starting the conversation in an honest and factual way gives perspective to minors.
Where can I get legal help?
Contact a CalNORML Legal Committee Attorney for legal assistance and further education on medical marijuana legal rights.