MORE PEOPLE BACK TO THE ILLEGAL MARKET – MAKING IT EVEN HARDER FOR LEGAL BUSINESSES TO STAY OPEN. STARTING TUESDAY- CANNABIS CUSTOMERS WILL SEE A BIGGER TAX ON THEIR RECEIPTS. CALIFORNIA JUST RAISED ITS EXCISE TAX FROM 15 TO 19 PERCENT – AN AUTOMATIC INCREASE WRITTEN INTO STATE LAW. “IT’S ALREADY PRETTY EXPENSIVE LIVING HERE. AND LIKE, THERE’S ALREADY A LOT OF CANNABIS TAX ALREADY. SO LIKE WHEN YOU LOOK AT THE RECEIPT, LIKE HALF OF IT IS TAX. SO IT’S PROBABLY GOING TO BE A LOT MORE. SO DEFINITELY NOT HAPPY ABOUT IT.” STATE LEADERS SAY THE TAX IS CRITICAL – IT FUNDS CHILD CARE, ENVIRONMENTAL CLEANUP, AND DRUG EDUCATION. BUT CANNABIS ADVOCATES SAY SHOPS ARE BARELY HANGING ON. LEGAL SALES HAVE BEEN DROPPING FOR YEARS – AND THE BIG FEAR NOW? THIS TAX HIKE COULD PUSH MORE PEOPLE TO THE BLACK MARKET. “MORE CONSUMERS ARE GOING TO TURN TO THE ILLICIT MARKET, THE ILLEGAL MARKETS, THEY’RE GOING TO TURN TO ONLINE RETAILERS THAT SELL PRODUCTS LIKE THC AND CBD. THESE PRODUCTS ARE UNTESTED. THEY’RE NOT REGULATED. AND THEY’RE JUST NOT SAFE. AND SO WE WANT CONSUMERS TO SHOP IN DISPENSARIES WHERE WE GO THROUGH RIGOROUS PROCESSES TO GET OUR LICENSE.” ILLEGAL GROWERS OFTEN HAVE “CHEAPER OPTIONS.” AND STATE DATA SHOWS ABOUT 60% OF CANNABIS SOLD IN CALIFORNIA IS STILL UNLICENSED. THAT’S ACCORDING TO A REPORT FROM THE STATE’S DEPARTMENT OF CANNABIS CONTROL. CUSTOMERS SAY THE PRICE GAP IS JUST TOO BIG TO IGNORE. “HOPEFULLY SOMEDAY IT’LL ALL BE DEREGULATED. BUT RIGHT NOW, WE HAVE TO PUT UP WITH THESE, YOU KNOW, SORT OF A LITTLE BIT BY BIT INCREASES THAT ARE REALLY KIND OF HARMFUL.” SHOPS LIKE THIS ONE IN MONTEREY ARE TRYING TO FIGHT BACK – OFFERING DISCOUNTS – TRYING TO KEEP CUSTOMERS FROM GOING UNDERGROUND. BUT MANY ARE HOLDING OUT HOPE FOR RELIEF. A NEW BILL – AB 564 – WOULD LOCK THE TAX AT 15% FOR SIX YEARS. IT PASSED THE ASSEMBLY UNANIMOUSLY – BUT STILL NEEDS SENATE APPROVAL. RIGHT NOW – IT’S ALL JUST A WAITING GAME. IF LAWMAKERS DON’T FREEZE THE TAX – CANNABIS SHOPS COULD KEEP LOSING CUSTOMERS TO THE ILLEGAL MARKET