Individuals planning to sell recreational marijuana or cannabis products next year must register with the California Department of Tax and Fee Administration (CDTFA) for a seller’s permit, according to Paul Cambra of CDTFA.
Proposition 64, approved by 57 percent of California voters in 2016 and rejected by 55 percent of Madera County voters, legalized recreational marijuana and allows local governments the ability to regulate or ban commercial pot operations.
The cities of Madera and Chowchilla do not allow the local manufacturing or retail sales of recreational marijuana products. Chowchilla also bans transport of recreational marijuana within the city. However Chowchilla city officials have recently been considering the possibility of allowing and regulating commercial pot.
Marijuana is still classified by as an illegal Schedule 1 substance under the Federally Controlled Substances Act.
Regardless, Cambra said pot growers, processors, manufacturers, retailers, microbusinesses and distributors who make sales are required by the state to obtain and maintain a seller’s permit if they wish to apply for a license with the Bureau of Cannabis Control, the Department of Food and Agriculture, or the Department of Public Health.
Registration may be completed online with the CDTFA. Individuals who already have a seller’s permit don’t need to register for a new one.
In addition, distributors of cannabis and cannabis products must also register with the CDTFA for a cannabis tax permit – which is separate from a seller’s permit – in order to report and pay the two new cannabis taxes to the CDTFA starting in January 2018. Registration for the cannabis tax permit will be available on Nov. 20.
Beginning Jan. 1, two new cannabis taxes will be in effect in California:
A 15 percent excise tax is imposed on buyers of cannabis and cannabis products. Retailers are required to collect the excise tax from the purchaser and pay it to the cannabis distributor.
A tax on the commercial cultivation of cannabis is imposed on growers, who must pay the cultivation tax to either a distributor or manufacturer depending on the nature of the transaction. The cultivation tax rates are $9.25 per dry weight ounce of cannabis flowers, and $2.75 per dry-weight ounce of cannabis leaves.
Individuals who operate a cannabis business that does not make taxable sales will need a certification letter from the CDTFA indicating that their business does not require a seller’s permit. The letter will be available through the CDTFA online registration system beginning Nov. 20.
To register for permits online, visit https://services.cdtfa.ca.gov/ereg/index.boe.