Commercial Cannabis Business Tax

Visit the official Monterey County Cannabis Program website

GENERAL INFORMATION

The commercial cannabis business tax is a tax due for engaging in commercial cannabis business in the unincorporated area of Monterey County.  A commercial cannabis business is defined as any commercial business activity relating to cannabis, including but not limited to cultivating, transporting, distributing, manufacturing, compounding, converting, processing, preparing, storing, packaging, delivering, and selling (wholesale and/or retail sales) of cannabis and any ancillary products and accessories in the unincorporated area of the County, whether or not carried on for gain or profit. (MCC § 7.100.040(E)).

Monterey County Code (“MCC”) § 7.100* and the Administrative Rules and Procedures for Commercial Cannabis Business Tax promulgated by the Monterey County Treasurer-Tax Collector provide that all persons or entitles engaged in commercial cannabis activities, as defined therein, are subject to a commercial cannabis tax as of January 1, 2017. 

All proceeds from the tax imposed are placed in the County’s general fund and are used for general governmental purposes. *adopted July 12, 2016

TAX RATES

The tax rates for commercial cannabis business within the unincorporated area of Monterey County are established in MCC§ 7.100.050*. A summary of the tax rates, as amended on February 14, 2023, are provided below and should not be relied upon as a substitute for a full review of MCC§ 7.100.

• The tax rate for commercial cannabis indoor cultivation, excluding nurseries, shall be two dollars and thirteen cents ($2.13) per fiscal year, per square foot of canopy authorized by each County permit, or by each state license in the absence of a county permit, not deducting for unutilized square footage

• The tax rate for commercial cannabis mixed light cultivation, excluding nurseries, shall be one dollar and forty-six cents ($1.46) per fiscal year, per square foot of canopy authorized by each County permit, or by each state license in the absence of a County permit, not deducting for unutilized square footage.

• The tax rate for commercial cannabis outdoor cultivation, excluding nurseries, shall be seventy-one cents ($0.71) per fiscal year, per square foot of canopy authorized by each County permit, or by each state license in the absence of a County permit, not deducting for unutilized square footage.

• The tax rate for commercial cultivation of cannabis as a nursery shall be seventy-one cents ($0.71) per square foot of canopy authorized by each County permit, or by each state license in the absence of a County permit, not deducting for unutilized square footage.

• The tax rate for manufacturing of commercial cannabis shall be one and one-half percent (1.5%) of the gross receipts per fiscal year.

• The tax rate for a commercial cannabis distributor or distribution facility shall be zero percent (0%) of the gross receipts per fiscal year.

• The tax rate on commercial cannabis testing laboratories shall be one percent (1%) of the gross receipts per fiscal year.

• The tax rate for commercial cannabis dispensaries shall be four and one-half percent (4.5%) of the gross receipts per fiscal year. 

Personal Cultivation/Personal Use

• Personal cultivation and personal use as defined by MCC § 7.95 is exempt from the commercial cannabis business tax.

BUSINESS LICENSE

A business license issued by the Monterey County Treasurer-Tax Collector is required for all commercial cannabis businesses within unincorporated Monterey County.  For more information on the application process for a business license, please visit Business License Information. 

ADDITIONAL RESOURCES

Monterey County Code, Chapter 7.02

Cannabis Permitting Information

Monterey County Cannabis Program Information

Business License Information