On May 11, Gov. Jerry Brown proposed creating new teams in the California attorney general\u2019s office to investigate the state\u2019s black market marijuana industry that has persisted in spite of legalization taking effect in the state with the start of this year.<\/p>\n
The\u00a0Los Angeles Times\u00a0reports<\/a>\u00a0that Brown\u2019s proposal came after registered cannabis companies complained that they are being undercut by the illicit growers and vendors.<\/p>\n Brown\u2019s office said in a statement that the governor has allocated $14 million to \u201ctarget illegal cannabis activity with an emphasis on complex, large-scale financial and tax evasion investigations.\u201d The teams are also to focus on \u201creducing environmental and other crimes associated with the illegal cannabis market.\u201d<\/p>\n The statement said four investigative teams are to be located in Los Angeles, Sacramento, Fresno and San Diego. A fifth team, focusing on interdiction, will also be based in Sacramento.<\/p>\n The proposal was openly welcomed by state-licensed firms.<\/p>\n \u201cWe have consistently maintained, since full implementation of the licensing and regulatory framework in January, that additional enforcement is essential to addressing illicit activity,\u201d Amy Jenkins, a legislative advocate for the\u00a0California Cannabis Industry Association<\/a>, told the LA Times.<\/p>\n However, Jenkins acknowledged that the state needs to also address \u201cbarriers to entry\u201d to the legal industry, including what she called high taxes and regulatory fees. She also cited a complete absence of local authorization in many areas. She characterized these factors as \u201csignificant impediments to compliance in the regulated marketplace.\u201d<\/p>\n Indeed, full annual licenses for cannabis businesses are\u00a0still not available<\/a>\u00a0from state authorities, and some 1,150 of the temporary applications have been rejected \u2014 overwhelmingly due to failure to win the required approval from local authorities. The\u00a0Los Angeles Times itself<\/a>\u00a0has also noted in recent coverage that the expense and bureaucracy of procuring a license is a \u201cheadache\u201d for many applicants due to high fees and requirements for upgrades to meet security and testing standards.<\/p>\n The LA Times\u2019 report on Brown\u2019s new proposal noted that the threat of federal interference in California\u2019s regulated cannabis industry is an obvious incentive behind increased state policing of black market marijuana.<\/p>\n However, perhaps a more cynical motive may be behind the state\u2019s crackdown: a desire for more tax revenue from the legal cannabis industry.<\/p>\n On May 10, the San Francisco Business Journal\u00a0reported\u00a0<\/a>that\u00a0cannabis tax revenue totaled a \u201cdisappointing\u201d $34 million in the first quarter of the first year of Golden State legalization. So California is not nearly on track to rake in the $175 million initially predicted for the first half of the year by Brown\u2019s office. This reality was noted by the\u00a0Legislative Analyst\u2019s Office<\/a>, a body that advises the state legislature on fiscal matters. It said in a somewhat wry statement: \u201cBased on this quarterly tally, we think that 2017-2018 revenue likely will be somewhat lower than the administration\u2019s January estimate.\u201d<\/p>\n The Business Journal notes that legal cannabis sales are slapped with a hefty 15 percent excise tax by the state, as well as an additional sales tax of 8-to-10 percent \u2014 which medical marijuana users don\u2019t pay. And that doesn\u2019t include local taxes that run from 5 to 15 percent. For example, in the Bay Area, Oakland\u2019s sales tax rate is 9.25 percent, while Berkeley and Richmond are at 5 percent, and San Francisco is one of the municipalities that has chosen not to impose a local tax. But by state average, consumers are paying up to 45 percent in taxes when purchasing legal \u201crecreational\u201d cannabis. This means that buyers, as well as producers, have an incentive to stick with the black market marijuana that Proposition 64 was supposed to eliminate.<\/p>\n TELL US,<\/b>\u00a0do you think California should crack down on black market marijuana?<\/p>\n The post Gov. Brown Proposes Task Force to Investigate Black Market Marijuana<\/a> appeared first on Cannabis Now<\/a>.<\/p>\n
On May 11, Gov. Jerry Brown proposed creating new teams in the California attorney general\u2019s office to investigate the state\u2019s black market marijuana industry that has persisted in spite of legalization taking effect in the state with the start of this year. The\u00a0Los Angeles Times\u00a0reports\u00a0that Brown\u2019s proposal came after registeredContinue Reading<\/a><\/span><\/p>\n","protected":false},"author":190,"featured_media":0,"comment_status":"false","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1143,148,50,3568,81,362,4265],"tags":[],"_links":{"self":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/26218"}],"collection":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/users\/190"}],"replies":[{"embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/comments?post=26218"}],"version-history":[{"count":1,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/26218\/revisions"}],"predecessor-version":[{"id":26219,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/26218\/revisions\/26219"}],"wp:attachment":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/media?parent=26218"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/categories?post=26218"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/tags?post=26218"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\nRead More: Gov. Brown Proposes Task Force to Investigate Black Market Marijuana<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"