Lompoc Voters Approve Cannabis Tax Increase
Lompoc voters have approved a tax increase on marijuana manufacturers and distributors in the city. Preliminary results show Measure Q passing with 76.84% of the vote.
Measure Q was placed on the ballot by the city council. It will impose a graduated tax of 0.5% to 2.5% on annual cannabis business revenue, generating an estimated $1.2 million annually. Dispensaries are not directly affected.
The new policy moves Lompoc from a flat annual tax to one based annual revenue. Currently, businesses with a net income of less than $2 million pay $15,000 and those with a net income of more than $2 million pay $30,000. Under Measure Q, the structure is as follows:
-0.5 cents per dollar for a manufacturing and distribution business making $10 million or less -one cent per dollar for those making $10 million to $25 million -1.5 cents for those making $25 million to $40 million -two cents per dollar for those making $40 million to $55 million -2.5 cents per dollar for those making $55 million plus
“They did get a benefit with the flat rate, but in re-examining the impact that manufacturing and distribution had on our local streets and our local public safety, it’s really important that we rectify the difference and have a more equitable tax rate for all of the business in town,” Mayor Jenelle Osborne told Noozhawk.
“We’re not looking to drive business away, but when we did our research and compared it to other municipalities both close and far from us, we realized that the flat rate was not equitable and that this is the time to make the change.”
In addition to the tax changes, customers will now be able to see the tax amount on their receipts. Measure Q also alters the definition of “manufacturing and distribution” and creates a definition for “cultivation.”