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.
Premium content for only $0.99
For the most comprehensive local coverage, subscribe today.
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.