If you are a cannabis user or business operating in Sausalito, California, you must be aware of the recent proposal to impose an additional 4% tax on the cannabis delivery and retail business. While the proposal might seem profitable at first glance, several factors make it inherently racist, and in turn, it could end up driving the legal cannabis market out of the city. In this blog post, we will dig deeper into why we should say NO to the Sausalito Cannabis Delivery and Retail Business Tax.
The proposed 4% tax will increase the financial burden on cannabis businesses and add an additional layer of cost for customers. These taxes often drive customers to cheaper and unregulated illegal markets, thus promoting illicit drug trade. It is essential to foster a healthy and holistic community in Sausalito, which includes our often marginalized and predominantly Black and Latinx village of Marin City, as these community members are more likely to be profiled and/or arrested for cannabis-related offenses. Therefore, the proposed tax sets a dangerous precedent as it could make cannabis inaccessible to marginalized communities who have already suffered due to the so-called “War on Drugs.”
Indeed, the proposed tax fails to consider the additional burden placed on small businesses. For example, small-scale operations, such as delivery businesses, cannot afford to pay the 4% extra cost on top of their existing expenses. Moreover, if the cost of Cannabis increases abruptly, these small-scale businesses will get driven out of the market, leading to unemployment, and further economic pressure on the already challenging situation of losing revenue due to COVID-19 for these businesses.
Furthermore, the proposed system also creates administrative barriers for businesses. The 4% tax is in addition to the existing taxes imposed by the State of California, which means cannabis businesses would have to keep track of different tax codes and regulations. This process is not only time-consuming, but it could also cost businesses a considerable amount in hiring experts to keep up with the state’s laws and regulations.
Moreover, statistics have shown that the legal cannabis industry already struggles to compete with illicit-market prices. Adding a 4% tax would make the legal market less attractive to consumers, which would discourage existing legal cannabis businesses. For example, medical cannabis patients who rely on cannabis for their medical treatment would have to bear the brunt of this increase.
The Sausalito Cannabis Delivery and Retail Business Tax is inherently racist and poorly designed. The proposed tax would increase the price of cannabis, create administrative barriers for cannabis businesses, and drive the legal cannabis market out of the town, leading to higher unemployment rates. It is our responsibility to say NO to such a proposal that could drive marginalized communities towards unsafe, unregulated, and illicit drug trade. The proposed tax defeats the purpose of legalizing cannabis and fails to create a sustainable model that benefits everyone. It is time to prioritize accessibility, transparency, and sustainability for communities and businesses that have already faced enough challenges due to the pandemic.
For more information on what Sausalito is trying to propose click here and say no: