Oakland Voters Approve Marijuana Tax

Oakland residents overwhelmingly voted Tuesday to approve a first-of-its kind tax on medical marijuana sold at the city’s four cannabis dispensaries.

Preliminary election results showed the measure passing with 80 percent of the vote, according to the Alameda County Registrar of Voters.

The dispensary tax was one of four measures in a vote-by-mail special election aimed at raising money for the cash-strapped city. All four measures won, but Measure F had the highest level of support.

Scheduled to take effect on New Year’s Day, the measure created a special business tax rate for the pot clubs, which now pay the same $1.20 for every $1,000 in gross sales applied to all retail businesses. The new rate will be $18.

Oakland’s auditor estimates that based on annual sales of $17.5 million for the four clubs, it will generate an estimated $294,000 for city coffers in its first year.

Pot club owners, who openly sell pot over the counter under the 1996 state ballot measure that legalized medical marijuana use in California, proposed Measure F as a way to further legitimize their establishments.

“It’s good business and good for the community,” said Richard Lee, who owns the Coffee Shop SR-71 dispensary and Oaksterdam University, a trade school for budding dispensary workers.

The measure had no formal opposition; in November 2004, a ballot initiative that required Oakland police to make arresting adults using marijuana for personal use their lowest priority passed with 63 percent of the vote.

Support for Measure F was expected to be just as strong. As a result and given the mail-in nature of the election, there was little campaign activity, according to Lee.

“We put out signs, but outside of that it’s been pretty low-key,” said Lee, who hosted a victory party at Oaksterdam University’s Student Union building in downtown Oakland.

Although California’s 800 or so pot clubs also are expected to pay state sales tax, Oakland is the first city in the country to create a special tax on marijuana sales.

Advocates of legalizing pot for recreational use hope to use Oakland’s experience with Measure F to persuade California voters next year to approve a measure that would legalize and regulate marijuana like alcohol.

– Article from The Associated Press on Jan 21, 2009.



  1. Sir Les on

    Something the law makers need to think about..

    If Tax defines law or legality….then there is no law of authority!
    For every law could be underminded by Taxes!

    Just thought that might sturr the pot.

    And another thing…Marijuana is being misclassified as a drug, When God already classed it as a food!

    Food is not to be taxed!

    And yet we go down another slippery slope!

    First they tax this food…then they will tax all the rest!

    then they will tax the air, water, and every time you flush…

    Not long now!

    keep it in mind!

    Sir Les

  2. Anonymous on

    You obviously don’t understand what their proud off… Its the fact that the government will collect tax on herb making it more legit and accepted, club owners sure as hell would not be celebrating losing money duh.

  3. *witchy* on

    So, the medical cannabis dispensaries used to pay $1.20 per $1,000; now they will be paying $18, and people are proud of this?

    I can’t think of any other situation in which a 15-fold tax hike has been celebrated.

    Remember that we are still talking about MEDICAL marijuana here… I wonder if the pharmacies would welcome a 1500% increase in their tax rate?