A new bill has been introduced in California which will see the legalisation of crypto payments for taxes and fees for cannabis-related businesses.
Assembly bill 935 will allow city, county, and state tax offices in California to accept stablecoins, which are cryptocurrencies pegged to fiat currencies or a physical asset.
After January 1st 2020, the bill will allow the “legislative body of a city or the board of supervisors of a county to determine and implement a method by which a licensee under MAUCRSA (Medicinal and Adult-Use Cannabis Regulation and Safety Act) may remit any city or county cannabis license tax amounts due by payment using stablecoins.”
The bill will authorise cities and counties to determine a method of accepting stablecoins directly or by utilising a third-party digital asset payment processor – which enables the immediate conversion of any stablecoin payment into USD and will deposit it into an account in the relevant jurisdiction.
Existing laws currently impose a state excise tax on the purchase of any cannabis-related products at a rate of 15% of the average market price of any retail sale by a cannabis retailer.
California also imposes a state cultivation tax for all cultivators who harvest cannabis that enters the commercial market. The rates are specified per dry-weight ounce of cannabis flowers and leaves.
Interested in reading more cannabis-related crypto news? Discover how this Colorado-based cannabis dispensary facilitated its first Bitcoin-to-weed transaction.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.