Cut off from the banking system by federal law, medical marijuana dispensaries would be allowed to pay their taxes in cash rather than by electronic transfer under a bill headed to Gov. Jerry Brown.
The California Senate on Tuesday voted 28-8 to pass Assembly Bill 821, which would remove a 10 percent penalty assessed on monthly tax bills of $10,000 or more if they paid by a means other than electronic transfer.
Currently, the Board of Equalization can waive those penalties on a case-by-case basis. But proponents of AB 821, including author Assemblyman Mike Gipson, D-Los Angeles, argued that the process imposes an unfair burden on a cash-only industry like medical marijuana dispensaries, which cannot place their revenue in most banks because federal authorities still consider marijuana an illegal drug.
“This is just a smarter way to do business,” Sen. Fran Pavley, D-Agoura Hills, said during floor debate.
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Though some Republicans objected to singling out the medical marijuana industry for special treatment, the bill passed with some bipartisan support. If signed by Brown, it would sunset in 2022.