RE: AB 1410 (Wood & principal co-author McGuire) Cannabis Cultivation Tax Collection – SUPPORT
On behalf of the California Growers Association (Cal Growers) representing over 800 members in 48 counties throughout California, we write to indicate our strong support for AB 1410 which would provide much needed clarity and flexibility with regard to the imposition of a tax payment at the time of harvest.
AB 1410 would allow a licensed cannabis cultivator to remit the tax obligation on the harvested product through a licensed distributor after the product completes the quality assurance, inspection and testing of that product. By allowing a cultivator to remit their tax obligation through a distributor, the bill would require a licensed distributor to file the tax return and remit the tax payment on behalf of the licensed cultivator.
AB 1410’s provisions are optional. If enacted, a cultivator – and any partnering distributor – can choose to remit their tax obligations to the Board of Equalization (BOE) through the distributor. The bill provides for maximum flexibility to the cultivator. If a cultivator chose to remit their tax cultivation obligations directly to the BOE, the cultivator could do so. AB 1410 provides for a second option – giving cultivators the ability to allowing a licensed distributor to remit those tax obligations on their behalf.
The bill does not change the tax rates spelled out in current statute. In fact, we believe AB 1410 will achieve greater tax collection compliance by giving cultivators a new options to streamline the cultivation tax payment process to the Board of Equalization.
Cal Growers has conducted numerous community workshops, surveyed our membership throughout the state and without question the imposition of the cultivation tax is the most difficult regulatory challenges our community faces this year. Given the challenges amending a voter initiative, the provisions in AB 1410 represent our best efforts to provide relief from this looming problem without triggering a vote of the people. We look forward to robust dialogue and deliberation and thank your offices for introducing this bill and creating the opportunity for stakeholders to work together to identify solutions.
We thank the author and principal co-author for their leadership of this important bill and encourage your support for assisting California’s cultivators with transitioning into a fully regulated marketplace.