Don't Mess With Taxes

But that statewide defeat did not stop several Golden State cities from looking for ways to make government money out of medical marijuana transactions.

Ten California cities had initiatives on their local Nov. 2 ballots to enact or increase taxes on medical marijuana sales. Voters in all 10 jurisdictions said "yes" to the proposals.

Sacramento voters approved a 4 percent tax on medical pot. Amy Williams, a spokeswoman for the city, said the vote simply allows the city to treat medical marijuana sales like any other business in the state capital.

Budget crises prompt pot taxes: The pot taxing cities are following the lead of Oakland, which last year enacted the country's first special tax on medical marijuana.The move was made in an effort to close the city's budget deficit.

On Nov. 2, Oakland voters agreed to an increase in that initial tax rate, bumping it from $18 to $50 for every $1,000 in sales of prescription pot. That's on top of the city's regular 9.75 percent sales tax.

San Jose and Long Beach also have budgetary issues and approved special marijuana taxes as a fiscal remedy.

Los Angeles voters didn't face a pot tax question this year, but they will in 2011.

The L.A. city council agreed this week to ask voters to for approval of a 5 percent tax on medical marijuana next March. City officials say the tax could raise up to $7 million a year.

Pot tax preparation: For other cities, local marijuana tax ballot measures on Nov. 2 were preparatory. If Prop 19 had passed, they could have started collecting new city revenue.

Long Beach voters overwhelmingly approved a 15 percent tax on businesses that sold marijuana for recreational use.

In Stockton, which levies a 4 percent tax on medical marijuana, voters OK'ed a 10 percent tax on non-medical marijuana sales.

Of course, the votes for taxes of recreational pot sales are moot since Prop 19 failed. But the efforts underscore how desperate some local governments are for funding.

And the concern is not limited to the Left Coast.

Colorado residents approved medical marijuana sales in 2000. This election, nine cities approved higher sales taxes on weed sold for medical purposes.

Related posts:

• Pot's potential to help pay state bills
• Drug tax dealings in Tenn., Calif.
• Taxing ill-gotten gains
• One toke over the IRS-approved medical tax deduction line
• Marijuana deduction goes up in smoke

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