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County closes in on a cannabis tax that may exclude lab testers

Peter Johnson Feb 8, 2018 4:00 AM

San Luis Obispo County has a cannabis tax measure ready for citizens to consider in the June elections—but it's making a final tweak first.

File Photo By Jayson Mellom
TAX TALK San Luis Obispo County is close to finalizing a cannabis tax measure for the June ballot.

On Feb. 6, county supervisors asked that a proposed 4 percent tax on gross receipts exclude lab testers, after cannabis industry consultant Sean Donahoe pointed out that testing is a public safety component of the industry.

"I think there's a case to be made that we want to encourage testing," 2nd District Supervisor Bruce Gibson said.

Other supervisors agreed; and directed staff to revise the measure to set the lab testing tax at zero. At the request of Tax Collector-Auditor Controller Jim Erb, the measure will also allow flexibility for the board to set different tax rates for different arms of the cannabis industry.

For all other elements of the industry—cultivation, manufacturing, distribution, and retail—the gross receipts tax is proposed to start at 4 percent in July 2018 and increase by 2 percent annually to a maximum of 10 percent. The Board of Supervisors can vote to lower the tax or forgo the annual increase.

As of press time, the cannabis industry in SLO County isn't exactly taking off. The county had received six land-use applications for marijuana businesses thus far, even though 141 cultivation sites are eligible to apply. Δ