San Diego Pot Tax Proposal Lingers in Council Limbo

If Prop. 64 is approved in November, the state's tax rate on medicinal marijuana would be 15 percent.

The prospect of a local sales tax on legalized marijuana was left up in the air Tuesday at San Diego's city hall.

Councilmembers were scheduled to vote on sending it to the November ballot -- but put off a decision for further study.

Council sources told NBC 7, there's been no breakdown in lawmaking machinery, it’s just that members just want to put more "eyes" on the measure’s “language”, so nothing's left to chance.

A deadline of August 12 looms for qualifying Council-generated issues for the general election.

The pot-sales tax hinges on California voters approving "adult use" of cannabis, by way of Proposition 64.

Right now 16 of the state's cities impose sales taxes on medicinal marijuana, ranging from six to 15 percent.

In the Bay Area, San Jose is reportedly collecting about $3 million a year from its dispensaries.

Prop. 64 would exempt medically prescribed cannabis sales.

If adult-use, or so-called "recreational" marijuana is legalized, San Diego's proposed tax would start at five percent for two years and float to eight percent thereafter -- with Council leeway to charge up to 15 percent later on.

Four medicinal dispensaries have permits to operate in San Diego and they're pushing for Council action to subject future adult-use sales to outlets facing the same regulatory framework if Prop. 64 passes.

There's still a big concern about "black-marketeers" undercutting the legitimately established businesses.

But for anti-drug activists, the whole idea of legalization and taxation of the proceeds sends the wrong message.

“Prop. 64 needs to go down. We need to send a message that we're done with drug dealers, done with the harms that it's doing in society,” says Pacific Beach resident Scott Chipman, an activist with San Diegans for Safe Neighborhoods.

“We want to protect our kids from these bad messages and keep our roads and streets and communities and our schools safe," Chipman added in an interview Tuesday.

The proposed city pot-tax measure will come back to the Council for ballot consideration on Monday.

If Prop. 64 is approved in November, the state's tax rate on medicinal marijuana would be 15 percent.

Contact Us