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State Plans to Relax Cannabis Rules, Roll Licensing Into One Agency

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New plans to consolidate licensing in the state for cannabis-related businesses may lower entry barriers to the potentially lucrative industry for interested entrepreneurs.

By July 2021, the state plans to roll into one three licensing entities that are currently housed at different state agencies: the Bureau of Cannabis Control, the Department of Food and Agriculture and the Department of Public Health.

According to a joint statement by the three agencies the Newsom administration will share more details about the plan by the Spring of this year.

“Establishment of a standalone department with an enforcement arm will centralize and align critical areas to build a successful legal cannabis market, by creating a single point of contact for cannabis licensees and local governments,” the statement reads.

Besides easing regulations, the state also plans to simplify taxation of the marijuana industry.

“The proposed changes move the responsibility for the cultivation excise tax from the final distributor to the first, and for the retail excise tax from the distributor to the retailer,” the statement goes on. “Moving the incidence of this tax to the retailer will eliminate the California Department of Tax and Fee Administration (CDTFA) requirement to estimate product mark-up and set wholesale tax rates. The changes will reduce the tax collection burden on the cannabis industry and simplify the tax collection process.”

Newsom also announced that the state will allocate a portion of $332 million in tax revenues to funding youth education, prevention, early intervention, and treatment; environmental protection; and public safety-related activities.

For more information on the state’s commercial cannabis cultivation licensing process, please visit http://calcannabis.cdfa.ca.gov/, call toll-free 1-833-CALGROW, or send an email to calcannabis@cdfa.ca.gov.

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