California: Marijuana Tax Handbook
California Marijuana Tax Rate
|Sales Tax Medical||Excise Tax Medical||Max Medical Tax||Sales Tax Recreational||Excise Tax Recreational||Max Recreational Tax|
2021 California Marijuana Tax Handbook
Medical marijuana legal in California, but there is no cannabis sales tax for it.
California consumers are required to pay a 7.50% sales tax on every purchase of marijuana for personal use. There is also an additional excise tax of 15% on every purchase of marijuana for personal use.
About California Marijuana Tax
No sales tax may be collected if the customer presents a valid medical marijuana identification card as a qualified patient or primary caregiver and a government issued ID.
The cannabis excise tax applies to the average market price of the cannabis or cannabis product that is sold. The type of transaction - 'arm's length' or 'non-arm's length' will dictate the average market price. An arm’s length transaction reflects the fair market value within the open market where each person knows the price and willingly participates in the transaction. The average market price must also include a markup which is currently 80 percent as determined by the California Department of Tax and Fee Administration. The 15% excise tax is determined from this price.
What is the most recent revenue statistic for California?
As of November 2020, the CDTFA released that the total tax revenue generated is $906 million from excise tax, $223.3 million from cultivation tax, and $682.9 million in sales tax.
Much of the funds goes to the general fund and some are designated for social services.
Is the California Marijuana Tax Weight-Based or Percentage-of-price-Based?
California's marijuana program uses both the Percentage-of-price and Weight-based tax system.
In addition to the gross receipts tax on sales, the following levies apply to marijuana cultivators: $9.25/ounce of flowers and $2.75/ounce of leaves.
The cultivation tax rates for 2021 are unchanged from 2020 due to recent legislation. The CDTFA will adjust the cultivation tax rates annually starting in 2022.
Does California have a Controlled Substances Tax?
California does not have a Controlled Substances tax involving Marijuana.
How do California's marijuana taxes compare to the states around it?
Note: It is illegal to transport marijuana accross state lines.
For more information about California Marijuana Taxes, visit the California Marijuana Tax page.