Last year, a Santa Cruz medical marijuana group headed by Valerie Leveroni Corral gave away $230,000 worth of cannabis to low-income residents with medical problems including HIV/AIDS and cancer.
However, California’s new pot legalization rules that took effect Jan. 1 now require her to pay taxes on such donations. If she made the same level of charitable contributions of cannabis this year, her tax would be up to $85,000. “It’s just too costly,” said Corral, director of the Wo/Men’s Alliance for Medical Marijuana, which has been shut down for the last five months.
On Thursday, state lawmakers announced a new bill to exempt compassionate care programs from paying state cannabis taxes when they are providing free medical pot to financially disadvantaged people living with serious health conditions.
With tax revenue from legal pot sales in California falling short of projections, a financial analysis firm estimated Tuesday that total sales this year will be $1.9 billion, significantly less than the $3.8 billion the company expected.
The firm, New Frontier Data, also had estimated that total sales in California would reach $6.7 billion by 2025, but the group now says it is more likely the industry will generate $4.72 billion by then.
Most cities in California have refused to allow pot businesses, and there are tough rules for those who want state licenses to grow, distribute and sell marijuana. Both are to blame for the lower-than-projected sales, according to Giadha Aguirre De Carcer, chief executive of New Frontier Data.
Green Street, an L.A.-based marketing and branding agency focusing on the cannabis space, has sold a 50% stake in its burgeoning business to high-profile investor Gary Vaynerchuk, the company announced Tuesday.
Founded by Rama Mayo and Joshua Shelton in late 2012, Green Street has helped celebrity clients including 2 Chainz, the Game and Broken Lizard (the comedy team behind the “Super Troopers” films) forge weed-related partnerships. In the last two years, the agency has also created a first-of-its-kind cannabis brand showroom in the penthouse of Miracle Mile’s historic Art Deco Wilshire Tower building and recruited a cadre of other like-minded brands to join them in a cannabis-business incubator environment.
(With that building in the process of being sold, Green Street is cloning its concept in a seven-story building under development in downtown L.A.)
When recreational marijuana use was legalized in California, it presented an opportunity to reduce or expunge convictions for possession crimes that made it harder for some people to get ahead in life.
It was a high time at the No Name restaurant on Fairfax Avenue Thursday night, complete with cups full of THC-infused Chex-style trail mix on the bar, Beboe’s slim, gold vaporizers tucked into wine glasses at each place setting and herbaceous candles emblazoned with the word “cannabis” flickering like freshly lighted joints across the moss-covered dinner tables.
Gov. Jerry Brown proposed Friday to create five teams in the state attorney general’s office to investigate California’s black market for marijuana after firms that received state licenses complained they are being undercut by the illicit growers and sellers.
Brown allocated $14 million to “target illegal cannabis activity with an emphasis on complex, large-scale financial and tax evasion investigations,” the governor’s office said in a statement.
The teams also will focus on “reducing environmental and other crimes associated with the illegal cannabis market.”
For the canna-curious, there will be a selection of artisanal beauty and wellness products infused with cannabis available to learn about and sample at this weekend’s annual Echo Park Craft Fair. The surge in interest in cannabis products has led to the unveiling of a special lounge for those age 21 and older at one end of the shopping and craft fair’s location, Mack Sennett Studios.
Representatives from brands such as DankGals (CBD and floral bath soaks), Kana Skincare (lavender and CBD sleep masks) and Khus & Khus (botanical CBD face and body serums) will be on hand to answer questions about how to use the products and what to expect from them.
Money collected through California’s marijuana taxes may fall short of the $175 million budgeted for the first six months of this year. The less-than-expected haul could force the Legislature to shelve a bill that would reduce the excise tax on pot from 15% to 11%, state officials warned Tuesday.
For the first three months of the year, the state collected $34 million in state excise taxes on cannabis. If the trend continues, revenue will be less than half of what was anticipated for the first six months, according to the Legislative Analyst’s Office.
“We’re not seeing the numbers” expected, said Assemblyman Evan Low (D-Campbell), chairman of the Assembly Business and Professions Committee. Tax revenue, he added, is “woefully below the projections.”