How are taxes on cannabis products determined?

In California, taxes on cannabis products are determined by the California Department of Tax and Fee Administration (CDTFA). Cannabis businesses must pay both excise and cultivation taxes as well as state sales tax, which is based on the retail price of the product. The excise tax is a 15% tax imposed on the average market price of cannabis products. The cultivation tax is imposed on each dry-weight ounce of cannabis that is sold or transferred from a cultivator to another party for sale. The state sales tax for cannabis products in California is currently 7.25%. In addition to this, counties and cities may impose their own taxes on cannabis products, so it is important to check with local jurisdictions for their specific tax rates. There are also certain cannabis products that may be exempt from paying taxes. For example, medical marijuana that is sold to qualified patients in California may be exempt from paying state or local taxes. Other exemptions may apply to low-THC cannabis products. It is important to check with the CDTFA for full details on what products are exempt from taxation. Overall, taxes on cannabis products in California are determined by the CDTFA and can vary depending on the product and local jurisdictions. It is important to be aware of all taxes when selling or purchasing cannabis products in California.

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How are taxes on cannabis products determined?

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