Fans stated San Diego’s tax rate on marijuana production facilities, which is among the greatest in the state, is discouraging those companies from opening in the city. Less than half of the city-approved production facilities have become operational. This had created a great strain on retailers and consumers by creating a space in the regional supply chain that requires some regional dispensaries to truck their cannabis into the city of San Diego from somewhere else in the state, originally reported by David Garrick .
Critics of reducing the marijuana taxes said San Diego’s overall tax profits, which have actually been impacted more by the pandemic because the city relies so much on tourism, can’t pay for social and other programs due to this loss.
They also complained San Diego lacks a cannabis equity program to help low-income people and minorities access to the lucrative market that has reasonably high in advance expenses. “I’m having a significant, major issue with reducing the tax rate for an industry that we have not opened up to everyone,” Council member Monica Montgomery Steppe stated.
Fans of decreasing the tax, stated city earnings would increase despite the lower rate, because a lot of more marijuana dispensaries would start running and the sales from more stores in operation would be paying city taxes, to help over come recent loses in revenue. A recent report from an analysis by the city’s Independent Budget plan Analyst approximated San Diego will lose between $2 million and $4 million over the next five years by decreasing the cannabis taxes. This amount seems low in comparison to the amount of taxes they would collect from more dispensareis in operation.
Gina Austin, the leading attorney for the area’s cannabis industry, said “the IBA analysis was based upon the flawed assumption that approved-but-unopened cannabis production centers will eventually open without a tax cut.”This is definitely not real,” said Austin, contending her clients would select instead to open in other cities with lower tax rates and rather pay their taxes to them at a lower rate.
Von Wilpert noted that the city treasurer has actually had a hard time to gather owed taxes from some marijuana organizations, but she ended up ballot in favor of the lower rate. The three votes against the proposition were cast by Elo-Rivera, Montgomery Steppe and La, Cava. Due to the fact that the proposal is under a city regulation, it will require another approval vote by the council in next month’s session.
In a separate vote, the council approved a new annual fee with a 7-2 vote to collect $20,802 for all San Diego cannabis businesses owners to cover oversight and regulation by the city’s Cannabis Business Division. LaCava and Council member Chris Cate voted “no.”
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