Last year, a Santa Cruz medical marijuana group headed by Valerie Leveroni Corral gave away $230,000 worth of cannabis to low-income residents with medical problems including HIV/AIDS and cancer.
However, California’s new pot legalization rules that took effect Jan. 1 now require her to pay taxes on such donations. If she made the same level of charitable contributions of cannabis this year, her tax would be up to $85,000. “It’s just too costly,” said Corral, director of the Wo/Men’s Alliance for Medical Marijuana, which has been shut down for the last five months.
On Thursday, state lawmakers announced a new bill to exempt compassionate care programs from paying state cannabis taxes when they are providing free medical pot to financially disadvantaged people living with serious health conditions.
“Compassionate care programs aid people who are seriously ill and suffering, and we should be helping them thrive, not squeezing them with business taxes that are forcing many of them to close,” said Sen. Scott Wiener, D-San Francisco, who authored the measure with Assemblyman Jim Wood, D-Santa Rosa.
Related: Medical marijuana patients, providers feel left behind in California’s new cannabis market
The requirement to pay taxes was included in Proposition 64, which was approved in 2016 by state voters. The measure legalized the growing and sale of recreational pot in addition to requiring those firms and medical marijuana cooperatives to pay a 15 percent excise tax on sales and a cultivation tax on top of existing sales taxes.
Wood said the proposed new law would allow nonprofit groups to “once again receive donations from cultivators and help patients treat their symptoms and maintain the best quality of life possible.”
Corral welcomed the legislation. “It’s a really good start,” she said.
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