California municipalities give cannabis companies tax relief while the state procrastinates

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California has plans to assist cannabis companies, but it’s taking too long to react

While it is true that some measures have already been announced to reduce marijuana taxes in California, state legislators do not seem to initiate the necessary processes. As a result of this lack of commitment, local governments in the Golden State are working to provide tax breaks to cannabis businesses. Movements such as these in the state’s counties and cities primarily reflect lobbying by industry organizations, as well as local businesses and residents themselves.

Many have begun to argue that taxes at all levels of the supply chain make cannabis companies feel stifled. As a result, they are unable to stay afloat while the illicit market is strengthened. The call for such tax breaks has been going on for some years now and has since accelerated.

All of this comes against the backdrop of a historic bear market for wholesale cannabis prices in the state, which was plummeted in 2021 due to oversupply. Moreover, all of this comes amidst several industry experts, operators, and even local lawmakers accusing the state of not doing enough to adequately address tax reform. Natalynne DeLapp, executive director of the Humboldt County Growers Association, said, “This is really a statewide issue.”

Because of all this lack of commitment, many claim that the cannabis industry is going through a time of crisis. Last month, Governor Gavin Newsom promised tax reform, although he did not give many details. Still, localities do not intend to sit idly by and wait for the changes to take effect. This is particularly true after learning that such legislative actions would not take effect until next year, and of course, if everything goes according to plan.