The Stanislaus County Insider
ALERT!
StancoInsider.com
Sacramento – The California State Board of Equalization (BOE) this week released an updated analysis of Proposition 19. Among their findings, the BOE found that because Proposition 19 “does not contain any new responsibility, rule, or law applicable on a statewide level…it is not possible to estimate the potential revenue gain.”
The BOE report notes that while Proposition 19 states that the purpose of the Act “is to, in part, ‘tax and regulate cannabis in order to generate billions of dollars for our state and local governments,’” the Act itself “does not establish a statewide regulatory framework, nor does it impose an additional statewide tax on cannabis.”
The BOE’s finding debunks the notion promulgated by proponents that Proposition 19 will somehow generate “billions” in new tax revenue for the state of California.
The proponents of Proposition 19 had been using a figure of $1.4 billion that was generated when the BOE did an analysis of Assembly Bill 390 – the language of which is NOT included anywhere in Proposition 19. According to the staff analysis:
“The BOE’s statewide estimate of marijuana consumption for AB 390 was based on numerous assumptions because actual data are not available. The legalization policy proposed by this measure complicates the revenue estimation task considerably over that for AB 390 (which proposed statewide legalization, licensing fees and a uniform excise tax across all jurisdictions). Specifically, Proposition 19, should it pass, presents the following challenges with respect to producing a revenue estimate:
· BOE staff does not know which local jurisdictions will choose to authorize the sale of marijuana products and which will not; nor can staff estimate the number of locations that will be authorized within a jurisdiction.
· Proposition 19 does not contain specific provisions at the state level governing taxation or retail sale. Local jurisdictions are free to choose to impose licensing fees or implement differing tax schemes or rates.
· BOE staff is not able to create estimates of marijuana consumption and price at the local level.
· BOE staff is not able to estimate the impact that legalization, local regulation, and taxation will have on the consumption and price for those jurisdictions that choose to authorize sales.
Nothing in this measure provides for statewide taxes on pot beyond those that currently exist. Instead, it leaves it up to the local governments to set up individual regulatory schemes and it is far from certain than they will participate. In other words, since there is no guarantee that local jurisdictions will authorize sales or any sense of how much the ones that do will tax marijuana, there is no way to estimate ANY additional revenue, much less the billions claimed by the proponents.
In noting another flaw in the initiative, the BOE noted that even if they were required to collect and administer a local cannabis tax or fee, the state would have to pass new legislation to provide them with the authority to do so.
The BOE report notes that while Proposition 19 states that the purpose of the Act “is to, in part, ‘tax and regulate cannabis in order to generate billions of dollars for our state and local governments,’” the Act itself “does not establish a statewide regulatory framework, nor does it impose an additional statewide tax on cannabis.”
The BOE’s finding debunks the notion promulgated by proponents that Proposition 19 will somehow generate “billions” in new tax revenue for the state of California.
The proponents of Proposition 19 had been using a figure of $1.4 billion that was generated when the BOE did an analysis of Assembly Bill 390 – the language of which is NOT included anywhere in Proposition 19. According to the staff analysis:
“The BOE’s statewide estimate of marijuana consumption for AB 390 was based on numerous assumptions because actual data are not available. The legalization policy proposed by this measure complicates the revenue estimation task considerably over that for AB 390 (which proposed statewide legalization, licensing fees and a uniform excise tax across all jurisdictions). Specifically, Proposition 19, should it pass, presents the following challenges with respect to producing a revenue estimate:
· BOE staff does not know which local jurisdictions will choose to authorize the sale of marijuana products and which will not; nor can staff estimate the number of locations that will be authorized within a jurisdiction.
· Proposition 19 does not contain specific provisions at the state level governing taxation or retail sale. Local jurisdictions are free to choose to impose licensing fees or implement differing tax schemes or rates.
· BOE staff is not able to create estimates of marijuana consumption and price at the local level.
· BOE staff is not able to estimate the impact that legalization, local regulation, and taxation will have on the consumption and price for those jurisdictions that choose to authorize sales.
Nothing in this measure provides for statewide taxes on pot beyond those that currently exist. Instead, it leaves it up to the local governments to set up individual regulatory schemes and it is far from certain than they will participate. In other words, since there is no guarantee that local jurisdictions will authorize sales or any sense of how much the ones that do will tax marijuana, there is no way to estimate ANY additional revenue, much less the billions claimed by the proponents.
In noting another flaw in the initiative, the BOE noted that even if they were required to collect and administer a local cannabis tax or fee, the state would have to pass new legislation to provide them with the authority to do so.
