The Issue

Hey there, fellow Californians! If you’re feeling the pinch of rising living costs, we have some bad news it may get more expensive. On July 1st, 2025 there will be an increase to the excise tax on cannabis from 15% to 19%. But, because California cannabis taxes are compounded it ends up adding up to about a 25% increase. Here is the math breakdown.

Selling price of cannabis product:  
$100.00  
Local cannabis business tax ($100.00 × 10%):  
$10.00  
Delivery:  (Although not all cannabis products have delivery service fee this is here to illustrate tha CA also taxes the service fee)
$5.00  
Subtotal subject to excise tax:  
$115.00  
Excise tax ($115.00 × 19%):  
$21.85  
Subtotal ($115.00 + $21.85):  
$136.85  
Sales tax ($136.85 × 8.5%):  
$11.63  
Total:  
$148.48  

 This hike puts us at risk of pushing more cannabis users—especially those who rely on it for medical purposes—back into the underground market. Especially because the state Medical Card program is costly and is difficult to navigate the system to attain one. California designed an economic frame work that discourages cannabis consumers and medical patients from access to tested products which is a serious public health concern.

The shops that  have stepped up to operate legally, are facing another major extinction event and as of now they’re facing an uphill battle to stay afloat.

At 15% compounded the purchasing of regulated cannabis has decreased but if the excise tax rises. To 19% compounded, we worry about the future of these businesses and public safety. The compounding tax issue not only drives up prices but also fuels the underground market. We see break-ins happening more frequently because street value cannabis can be sold without those taxes, undermining the entire purpose of legalization. 

This highlights an urgent need for California to rethink its approach to cannabis taxation. We need comprehensive reforms that benefit both consumers and the small businesses we love.

So, we’re calling on you, Governor Gavin Newsom, to take this matter seriously and push for sensible tax reforms in the cannabis industry. 

Please sign this petition and help us make our voices heard on this critical issue!