Marijuana’s 1.6 million dollar payday to Los Angeles

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LOS ANGELES (CNS) – Medical pot shops in Los Angeles recently paid $1.6 million in taxes to the city, despite voter-approved restrictions aimed at greatly reducing the number of authorized medical marijuana dispensaries, according to figures provided by city officials today.
Proposition D, which was approved last May, limited the number of dispensaries to the roughly 135 that registered with the city prior to September 2007 and placed restrictions on their operation, but pot shops operators have continued applying for tax registration certificates, officials said.
Nearly 300 dispensaries were issued the certificates after July 20, when the proposition took effect, according to Department of Finance General Manager Antoinette Christovale.
Over the years, the city has issued a total of 1,400 tax registration certificates to so-called “medical marijuana collectives,” and since the taxation began in 2011, the city has collected $8.6 million from such businesses, Christovale said.
Taxes are due Jan. 1, but businesses have until Feb. 28 of each year to pay them, she said.
The latest $1.6 million in taxes represents the amount collected from medical marijuana collectives since Jan. 1, Christovale said.
Tax registration forms have allowed some medical marijuana shops to pass themselves off as legally operating businesses, City Attorney Mike Feuer said Monday.
Feuer said he has no plans to ask the Finance Department to stop issuing the tax registration certificates, but he will be notifying businesses that received the certificates “over the past year” that they are barred from operating under Proposition D.
Of the 1,400 tax registration certificates issued, 1,140 are listed as active, according to Christovale.
Proposition D also included a tax hike that kicked in on Jan. 1, raising the tax from $50 to $60 per $1,000 of gross receipts generated by medical marijuana collectives.
Feuer has prosecuted more than 300 individuals involved in illegal dispensaries, with 27 pot shops closing due to criminal prosecution filed by his office, a Feuer spokesman said.
“Dozens of defendants” at more than 20 of the locations “have paid fines and are on probation,” Rob Wilcox said.
Feuer said this week that about 100 dispensaries in all have closed since the ban, either due to criminal prosecution or voluntarily.

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