California Legislative Update Report

According to JD Supra, as the California Legislative session progresses, more and more cannabis tax reform bills are being introduced. Over the last few weeks, seven lawmakers introduced six separate measures focused on altering California’s cannabis tax code. These bills take a variety of approaches. But all aim to adjust the way cannabis taxes are collected.

This is in response to Governor Newsom’s state budget proposal, which listed overhauling cannabis taxes among his top priorities. Due to the range of youth and childcare-focused programs that receive significant funding from cannabis tax revenues, changing the tax code is controversial.

One bill, SB 1281 (21R), introduced by Sen. Steven Bradford, was amended to mandate that the California Department of Finance estimate how much revenue would have been gathered under the original cannabis tax structure, and transfer that amount from the general fund to the California Cannabis Tax Fund. This amendment is likely to appease youth groups, which have been vocal in opposing changes to the cannabis tax structure that would impact their funding.

Not all proposed legislation aims to aid those operating in the cannabis space. For instance, SB 1097 (21R) (Pan) demands manufacturers to include a warning label on cannabis product packaging. The warning will involve a rotating set of messages that can range from mental health risks that can come as a result of high-THC cannabis to the possible dangers for expecting mothers and their children. This will require cannabis products to implement a warning system. It also pressures retailers to give a brochure for first-time customers regarding how they can safely use cannabis products.

As the legislative session continues, we can expect to see more bills introduced that attempt to balance the competing interests of different stakeholders within the cannabis industry. Ultimately, it will be up to lawmakers in California to determine which approach is best suited to meet the needs of the state.

Louis Levey is the Content Success Manager and Founder at No Strings Content. He's passionate about helping cannabis businesses use content to attract, educate, and convert audiences. His hometown is Boca Raton, Florida, but he currently lives and works remotely in Chiang Mai, Thailand.

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