On Thursday evening, San Luis Obispo County is hosting an open house on cannabis taxation. County officials are looking for public input on what type and amount of tax the county will charge, on top of the statewide tax.
On November 27, the county board of supervisors finalized land use regulations for cannabis grows and manufacturing. The next step is figuring out local taxation.
James Erb is a CPA and San Luis Obispo County’s tax collector. It’s his job to come up with a few alternatives, which the supervisors will vote on in January. The tax plan picked by the board will be put on a ballot for voters to decide next summer.
"The board has asked me to reach out and see what people are interested in," Erb said. "The board doesn't want to overtax the industry, but they want to make sure that any consequences from the legalization of cannabis are covered."
This week's meeting is all about cannabis taxes in unincorporated areas of the county - which will apply to the mobile delivery services since the supervisors voted this week to ban retail shops. For eventual store fronts or delivery services within individual city limits, the cities will be deciding their own tax rates.
Whatever county taxes are collected go into the general fund. From there they can be allocated to more law or code enforcement. Erb says the county doesn’t want to set the tax too high, and is leaning towards a gross receipts tax, which is a percentage added to sales, like a sales tax.
"There are some places that are charging quite a bit. For example, Monterey County…within a few years they will be up to $25 dollars a square foot. So if you're authorized to grow an acre, that would be over a million dollars that they would have to come up with and that’s a tax we don't feel is really that fair, because you know people sometimes have crops that fail or something happens," Erb said. "Gross receipts would be based on what was actually there and available."
Thursday's forum takes place from 6 to 8 p.m. at the county building in downtown San Luis Obispo.