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Business Taxes Law Guide—Revision 2024
Cannabis Tax Regulations
Title 18. Public Revenues
Division 2. California Department of Tax and Fee Administration — Business Taxes (State Board of Equalization — Business Taxes — See Chapters 6 and 9.9)
Chapter 8.8. Cannabis Excise Tax Effective on and After January 1, 2023
Regulation 3800
Regulation 3800. Cannabis Excise Tax and Cannabis Retailer Excise Tax Permit.
Reference: Sections 34011.2, 34014, 34015, and 55302, Revenue and Taxation Code.
(a) Definitions. For purposes of this regulation, the following terms have the following meanings:
(1) "Business information" means information the Department deems necessary to determine if a person is required to obtain a cannabis retailer excise tax permit from the Department, determine if the person is required to remit the cannabis excise tax it collects by electronic funds transfer, assign the person a reporting period, and determine how to obtain access to the person's books and records. Such information includes, but is not limited to, the name of the person's business, the addresses of the person's business locations, the date the person's business started or will start, the business's business activities, the business's projected revenue, and the name and contact information of at least one individual the Department may contact to obtain access to the business's books and records.
(2) "Contact information" means information the Department deems necessary to contact and communicate with a person applying for a cannabis retailer excise tax permit and with that person's authorized representative(s). Such information includes, but is not limited to, a current mailing address, email address, and telephone number.
(3) "Department" means the California Department of Tax and Fee Administration.
(4) "Identifying information" means information the Department deems necessary to specifically identify a person applying for a cannabis retailer excise tax permit. Such information includes the person's name, the person's type (e.g., individual, partnership, limited liability company, corporation, etc.), and the person's Federal Employer Identification Number, and may also include, but is not limited to, the person's driver's license number or other government-issued identification card number or entity number issued by the California Secretary of State.
(5) "Ownership information" means information the Department deems necessary to identify the owners of an entity or business. Such information includes, but is not limited to, the owners' names and contact information.
(6) "Representative information" means information the Department deems necessary to verify that the individual who submitted an application for a cannabis retailer excise tax permit is the person applying for a cannabis retailer excise tax permit or is authorized to submit the application on behalf of the person applying for a cannabis retailer excise tax permit. Such information includes, but is not limited to, the individual's name, title, and contact information.
(b) A cannabis excise tax is imposed upon purchasers of cannabis or cannabis products sold at retail in this state on and after January 1, 2023, pursuant to Revenue and Taxation Code section 34011.2. The tax is 15 percent of the cannabis retailer's gross receipts from the retail sale of the cannabis and cannabis products to the purchaser on and after January 1, 2023, and the cannabis retailer is responsible for collecting the cannabis excise tax from the purchaser and remitting that tax to the Department.
(c) On and after January 1, 2023, a person must have a cannabis retailer excise tax permit issued by the Department to engage in business as a cannabis retailer.
(d) To obtain a cannabis retailer excise tax permit, a person shall complete and submit an application for a cannabis retailer excise tax permit through the Department's online services portal via its website at www.cdtfa.ca.gov. Every application for a cannabis retailer excise tax permit shall provide the applicant's identifying information, contact information, business information, ownership information, and representative information.
History— New chapter 8.8 (Regulations 3800, 3805, and 3810) and regulation filed January 30, 2023, as an emergency; effective and operative January 30, 2023. A Certificate of Compliance must be transmitted to the Office of Administrative Law by January 30, 2025, or the chapter and regulation will be repealed by operation of law on the following day.