Los Angeles Voters Approve Taxing Marijuana Dispensaries

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Photo: The 420 Times

‚ÄčLos Angeles voters on Tuesday approved a measure to tax medical marijuana dispensaries as a new source of revenue for the budget-challenged city.

Early returns from Tuesday’s polls showed most voters favored Measure M, which would allow the city to collect $50 out of each $1,000 in “gross reimbursements” that dispensaries receive from patients, reports Yang Lina at Xinhua.
With 40 percent of precincts counted, Measure M was ahead by a margin of 62 percent to 38 percent, reports Gene Maddaus at LA Weekly.

The new tax is expected to generate $10 million a year for the city. Proponents said the money could be used to pay for basic services like police, libraries and street repairs.
But, “Realistically, it’s likely to face a legal challenge from the dispensaries, so don’t count on seeing this money any time soon,” Maddaus writes in LA Weekly.
But opponents of the tax, including many marijuana advocates, expressed disappointment over its approval.
“We campaigned hard against this additional tax in Los Angeles, because patients already pay a nearly 10 percent (sales) tax on the medication that’s already expensive and unaffordable for many,” said Kris Hermes, spokesman for Americans for Safe Access, a medical marijuana advocacy group.
City Council President Eric Garcetti questioned whether the tax was even legal.
“If marijuana is supposed to be medicine, you can’t tax medicine,” Garcetti said. “And if it is a gross receipts tax on a business, these are not supposed to be businesses,” he said. “If this wound up in court and we lost, a year from now or two years from now, it could blow a hole in the budget when we have to return the money.”
In an odd alliance with dispensary owners and advocates, Measure M was opposed by Police Chief Charlie Beck, Sheriff Lee Baca and District Attorney Steve Cooley, who pointed out that federal law bans growing, possessing or consuming marijuana for any purpose.
“The city should not place a tax on something our federal government considers a Schedule I narcotic and against the law,” they said.
Several other cities in California have already imposed marijuana taxes, including San Jose, La Puente, Oakland, Richmond, Sacramento, Berkeley and Long Beach. The charges range from $25 to $50 per $1,000 in gross reimbursements.
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