California Cannabis Tax Rate

20–30% Total Effective Tax

Administering Agency: California Department of Tax and Fee Administration (CDTFA) · Updated for 2026

27% – 38% Combined effective cannabis tax (excise + state sales + local)

Tax Breakdown

Tax	Rate	Notes
State Cannabis Excise Tax	15%	Applied to retail gross receipts
State Sales Tax	7.25%	Medical cannabis exempt
Typical Local Sales Tax	2.25%	Average — actual rate varies by city/county
Local Cannabis Business Tax	Up to 10%	City-level cannabis-specific tax where allowed

Official source: California Department of Tax and Fee Administration (CDTFA) ↗ · rates compiled 2026-08-11 · verify current rates at the source before filing.

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How Medical Cannabis Is Taxed

Medical patients with a valid MMIC card are exempt from state sales tax, but still pay the 15% state cannabis excise. On a $100 pre-tax purchase that's roughly $7.25 less than an adult-use sale (before any local taxes, which vary by ordinance).

California Cannabis Tax Notes

15% state cannabis excise on retail gross receipts. The rate briefly rose to 19% on July 1, 2025 under AB-195’s revenue trigger, then AB 564 (signed September 2025) rolled it back to 15% effective October 1, 2025 and holds it there through June 30, 2028. Cultivation tax was repealed in 2022. Medical patients with a valid MMIC card are exempt from state sales tax. Cities layer their own cannabis business taxes (0%–10%); San Francisco has suspended its local cannabis tax through 2035.

City Cannabis Tax Rates in California

Cities in California can layer their own cannabis business tax on top of state taxes. Here are the reported rates for major cities — use the tax calculator to model a specific purchase:

City	City Cannabis Tax	Total Effective Rate
Los Angeles	10%	34.5%
Oakland	10%	34.5%
San Francisco	0%	24.5%
San Diego	8%	32.5%
Sacramento	4%	28.5%
Long Beach	8%	32.5%

Calculate a California Purchase → Compare with Another State → California Regulations →

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Frequently Asked Questions

What is the cannabis tax rate in California?

The combined effective cannabis tax in California ranges from 27% to 38% depending on the city. That includes a 15% state cannabis excise tax, 7.25% state sales tax, typical local sales tax, and any city cannabis business tax.

Does California exempt medical cannabis from tax?

Medical patients with a valid MMIC card are exempt from state sales tax, but still pay the 15% state cannabis excise. That works out to roughly $7.25 less per $100 pre-tax than an adult-use purchase, before any local taxes.

How much is the state cannabis excise tax in California?

California imposes a 15% state cannabis excise tax on retail purchases. This is collected in addition to state sales tax and any local cannabis business taxes.

Can cities add their own cannabis tax in California?

Yes. California cities can add a local cannabis business tax up to approximately 10% on top of state taxes. Major cities often use close to the maximum allowed rate.

Which agency administers cannabis tax in California?

Cannabis tax in California is administered by the California Department of Tax and Fee Administration (CDTFA). Licensed retailers file returns and remit taxes on a regular schedule.

For informational purposes only. Not legal, tax, or financial advice. California cannabis tax rates change — always verify with the California Department of Tax and Fee Administration (CDTFA) and consult a licensed tax professional. Read full disclaimer