While Todd Mitchell is thrilled about the opening of his new Marijuana store Seaweed, he's not looking forward to the state of California increasing business tax rates on legal marijuana in 2020.
“This means that for store owners, we're going to have to charge the public over 30 percent tax,” Mtichell said.
Marijuana advocate Joe Garcia, who came by to purchase some items at Seaweed's soft opening believes the increased tax rate will enhance the already thriving tax-free illegal market in California.
“This is really devastating for the cannabis industry. The industry has already been faced with a shortage of dispenceries being able to open up,” Garcia said.
to the California Department of Tax and Fee Administration, it
is responsible for determining the cannabis mark-up
rate every six months. an analysis of statewide market data was used to determine the average mark-up rate between the wholesale cost and the retail selling price of cannabis and cannabis products.
The new marijuana tax rate will go into effect on January 1, 2020.