Cannabis Inspection Program

The Cannabis Tax Law imposes a cannabis excise tax on purchasers of all cannabis and cannabis products sold at retail in California, including medicinal cannabis and medicinal cannabis products.

We are responsible for administering the collection and enforcement of the cannabis excise tax. We are authorized to  inspect any place at which cannabis or cannabis products are sold to purchasers, cultivated, stored, where evidence of activities involving evasion of tax may be discovered or at any place where any product or object of any kind bears the universal cannabis symbol. Our Inspections Section team members conduct regular inspections to ensure cannabis businesses are complying with state cannabis tax laws.

During an inspection, our inspectors will check to see if:

  • You have the required permits to sell cannabis or cannabis products.
  • Your purchase invoices and sales receipts reconcile with your inventory.
  • Your cannabis or cannabis products are in secured packaging as required by the laws administered by the Department of Cannabis Control (DCC).
  • You have an active commercial cannabis license with DCC.
  • You properly reported cannabis or cannabis products in the California Cannabis Track-and-Trace system.

Our inspectors may seize cannabis or cannabis products from a person who possesses, stores, owns, or has made retail sales of cannabis or cannabis products if:

  • The cannabis or cannabis products are not contained in secure packaging,
  • The person is not properly licensed with DCC to engage in commercial cannabis activity, or
  • The person knowingly does not report or falsely reports their sales or transfers of the cannabis or cannabis products in the California Cannabis Track-and-Trace system.

Additionally, our inspectors may seize any package or object of any kind that bears the universal cannabis symbol used or possessed in connection with commercial activity other than commercial cannabis activity licensed by the DCC in violation of Business and Professions Code section 26031.6 and deemed contraband.

  1. Revenue and Taxation Code section 34016