San Francisco officials delay new cannabis tax by a year



San Francisco officials decided to hold off by one year the implementation of a new cannabis sales tax.

According to Law360, the city’s Board of Supervisors unanimously approved a delay of the new tax until the end of 2021. The tax was slated to go into effect in January 2021.

The new tariff, approved by voters in 2018, is a sales tax on all marijuana products at 2.5% on gross receipts up to $1 million and at a 5% rate on receipts beyond $1 million.

There’s also a separate tax for marijuana businesses who take in revenues from non-marijuana products: 1% on revenues up to $1 million and 1.5% on revenues above $1 million.

San Francisco Supervisor Rafael Mandelman told the board he proposed the delay in implementation to give cannabis companies some financial relief because the city has had multiple delays in the marijuana business licensing process.

He said that when the tax was approved by voters two years ago, it was anticipated that far more businesses would be operational by January 2021.

But the city’s licensing of marijuana businesses has been slow to date, with many operators needing up to three years to navigate the process and open their doors to consumers.





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