What To Do With Cannabis Money California
LOS ANGELES — Amid concerns that California's cannabis industry is overtaxed and on the brink of collapse, children's and youth advocates say cutting marijuana taxes could put badly needed social service programs in jeopardy.
Small cannabis farmers and business concern owners have repeatedly asked the land to overhaul the industry's tax system as they struggle to stay afloat with rising operating and regulatory costs.
Every bit of Jan. 1, cannabis is taxed at a apartment charge per unit of about $161 a pound, on pinnacle of a xv pct excise tax, as well as local cultivation, manufacturing, processing, distribution and retail taxes. The country raked in nearly $1 billion in cannabis taxation revenue during the kickoff three quarters of 2021.
Last calendar month, Gov. Gavin Newsom said he supported cannabis tax reform and planned to work with the Legislature to modify policies. Lawmakers have also rallied to back up the industry and have already proposed at least one neb that would change the current structure.
Service providers for low-income and at-run a risk youths say they oppose any cuts, because their programs rely heavily on money collected from Proposition 64, the 2016 ballot initiative that made recreational cannabis legal in California.
"We've heard a lot about the affect to the cannabis industry but take heard little to no impact to those who benefit from these taxes," Mary Ignatius, the statewide organizer for Parent Voices California, which advocates for affordable child care, said at a news briefing Wednesday.
Marianna Hernandez, a prevention manager at Community Coalition, an advocacy and social justice grouping based in South Los Angeles, said cutting services would be "an insult" to those disproportionately affected past the "state of war on drugs."
"South L.A. was once overcriminalized for cannabis utilize, sale and possession," she said. "To now strip the community of the resources coming from the tax revenues is, quite frankly, an insult to South 50.A. Blackness and brown residents, many of which nonetheless accept family members incarcerated to this day due to marijuana-related charges."
In the state budget for fiscal year 2021-22, nearly $400 million in revenue from California's cannabis taxes will get to child care and prevention services for thousands of children in poverty. That includes more than $279 million allocated to the Section of Social Services for child intendance and nearly $81 million for youth prevention programs supported through the Department of Health Care Services.
Combined, more than than 21,000 low-income children across the land benefit from kid care services programs, but as many as two.three 1000000 could be eligible, Ignatius said.
"That'south why these Prop 64 dollars are so disquisitional," she said. "Any cuts to cannabis tax rates will result in cuts to child treat generally children of colour living in poverty who need that access now more than always."
But motility is already underway to reform cannabis taxes in California.
On Tuesday, the San Diego City Quango voted in favor of lowering a city tax on new production facilities from viii percent to 2 percent in hope of encouraging more indoor farms and factories to motion into the expanse.
On the aforementioned 24-hour interval, state Sen. Mike McGuire introduced a beak that would eliminate California'due south 15 percent cultivation tax as of July ane and increase the excise tax by an amount that would generate only half the acquirement the cultivation taxation would accept provided.
McGuire'southward function did non immediately respond to a request for comment Wednesday.
More reform bills are likely to exist introduced in the coming year that could threaten services to communities hit hardest by mass incarceration and poverty, said Jim Keddy, executive director of the advancement organization Youth Forward.
"Not just does cannabis tax revenue play a crucial office in funding child care, only information technology is as well a chief funding source for services for the formerly incarcerated, youth prevention services, job training and other critical support systems in communities of colour that have been impacted by the war on drugs," Keddy said.
"In downturn years, kids living in poverty, kids of colour, those programs get cut," he added. "That's why this revenue stream is so disquisitional at present."
Keddy was among dozens of advocates and service providers who sent an open letter of the alphabet this week request Newsom and legislative leaders to reconsider overhauling the state's cannabis tax organization.
They warned that "if the industry is successful in persuading country leaders to lower, suspend and/or eliminate the tax rates approved past voters in Proffer 64, we will meet an firsthand, negative impact on thousands of children living in poverty and children of color across our land."
"Whatever reduction in cannabis taxes will directly harm the most vulnerable communities in our state and will deepen racial and economic inequities," they wrote. "For these reasons, nosotros are opposed to the proposal put forward past the industry and ask that you accept into account the impact of the proposed policy on children, youth and families."
Source: https://www.nbcnews.com/news/us-news/cuts-california-cannabis-taxes-harm-low-income-youths-advocates-say-rcna16560
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