The bill is set to expand the administrative power of the California Board of Equalization in managing taxes related to marijuana. It introduces stricter permit regulations for those involved in the cultivation and sale of marijuana, allowing for the suspension or revocation of permits under certain violations. Moreover, it imposes specific criminal penalties for violations related to the cultivation and excise taxes, potentially increasing revenue from fines deposited into the California Marijuana Tax Fund. This administrative framework aims to ensure a more organized and compliant marijuana market while addressing tax evasion concerns.
Assembly Bill 963, introduced by Assembly Member Gipson, focuses on taxation related to marijuana in California. It modifies provisions under the Control, Regulate and Tax Adult Use of Marijuana Act (AUMA), approved by voters in November 2016. The bill establishes additional regulations for the taxation of marijuana sales and cultivations, including the imposition of excise taxes on marijuana products, a cultivation tax, and updates on how revenues are allocated to the California Marijuana Tax Fund. This fund is authorized to allocate resources continuously for specified purposes, aiming to support local and statewide initiatives related to marijuana use and regulations.
The general sentiment surrounding AB 963 is mixed. Supporters argue that it provides much-needed structure to the burgeoning marijuana industry in California, concentrating on compliance, transparency, and proper taxation that could potentially enhance state revenues. On the other hand, there are concerns about the stringent regulations it imposes on businesses and the potential for increased penalties which could burden smaller operators in the market, raising fears of exclusion for those unable to keep up with new requirements.
Notable points of contention include the potential implications for local governments and communities, as the bill does not require reimbursement for certain costs incurred. Many advocates for local control fear that the sweeping provisions may undermine local jurisdictions’ authority to regulate marijuana effectively on a community level. Additionally, while the intent is to combat illegal practices within the marijuana industry, the enhancements on criminal penalties and the formation of a Cannabis Criminal Enforcement Team could push businesses towards the black market if they feel excessively pressured by regulations.