Growers, beware: Santa Barbara County now comes with stricter cannabis tax laws. Only 49 percent of the county’s legal cannabis operators were reporting or paying any quarterly taxes, and in response, the Board of Supervisors affirmed on Tuesday that operators are required to file the quarterly report on time and to make the tax payment within 60 days of the due date. The penalty for failing to do so is having their business license revoked or not renewed.
The county’s first cannabis ordinance, enacted in 2018, held the same penalty, but only if taxes were not paid at all. Those with zero revenue were not required to report. Scofflaws make up a small percentage of the operators, staff stated during the first hearing in June. Of the 69 operations in the county, nine failed to report and 26 reported zero gross receipts, or 51 percent.
Even with the change to the ordinance, the county is looking at as much as $10.2 million less in cannabis taxes for the fiscal year because of problems such as permitting and oversupply in the market causing tax revenues to drop, the county’s third-quarter cannabis report noted.