California enacts tax warrants in fight against illicit marijuana businesses

In California’s ongoing battle against the illicit cannabis market, the state’s central tax collection agency served a dozen tax warrants to illegal marijuana retailers in Southern California in recent weeks.

Roughly $1 million in underground marijuana products and about $100,000 in cash was seized during the actions, which were taken in conjunction with the state Highway Patrol.

A tax warrant, also known as a lien, allows the government to claim your personal property or assets to satisfy unpaid taxes.

Warrants were served over the past few weeks in Los Angeles and San Bernardino counties, the California Department of Tax and Fee Administration (CDTFA) said in a news release.

“Tax evasion unfairly shifts the burden onto all other taxpayers and makes it tough for those businesses that are playing by the rules to survive,” CDTFA Director Nick Maduros said in a statement.

The agency did not identify the 12 retailers that were served. But the agency noted in its release that state cannabis tax evasion is a crime punishable by fines or even jail time.

California’s immense illicit marijuana market has been thriving for years, in part because unlicensed retailers commonly do not pay state or local taxes and, thus, are able to lure consumers away from the legal market with cheaper price points.

The state expects to significantly ramp up enforcement against the underground market in coming months and years, so it’s likely the CDTFA will serve more tax warrants.

To further assist the state’s battle against illicit operators, the Bureau of Cannabis Control in June requested 87 sworn peace officers.

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3 comments on “California enacts tax warrants in fight against illicit marijuana businesses
  1. Pat on

    Here’s the acid test question: Is the ca. tax paying public going to be better off with the hiring of 87 law enforcement officers to go after all these bad actors, licensed/unlicensed, to assist in the uprighting of a sinking ship named the “USS BCC”? Meaning, is the cost of hiring and benefitting a large group of people to engage in such as task, while still enlarging/enabling one of the most corrupt and inept agencies ( and their partners ) in the state, going to be worth it for the ca. citizen? Public safety wise? Environmentally wise? Public health wise? Is it economically wise? And, is it politically wise? And for whom?

    This is ca. we’re talking about. A notable bellwether state when it comes to progressive legislation. Right? Used to be. About 40 yrs earlier and before. Not these days. It seems that where money is to be made, the special interests dominate at the expense of the ca. citizenry. Ca. has had many decades to get this right as it relates the cannabis question. The state is well versed on the culture, socio-economics and race wrapped up in this issue. More so than any other state in the union. However, the state tossed all of that to the side. The state also didn’t consider relevant and fact based evidence as it relates the public safety, public welfare, significant negative environmental impacts nor the real fiscal taxpayer consequences with the promulgation and implementation of what has been revealed as an extremely flawed law. How bad was the downside going to be if the state allowed the likes 215/420 to essentially continue, therefore allowing most anyone that could, grow and sell the herb? Of course it would all have to be tested for the essential concerns. And taxed. The model was working for the masses. But, not the special interests. No comparative study was ever produced for public consumption before this law was enacted. What harm were 215/420 exposing ca. citizenry to that existing laws couldn’t remedy? They were already there. What happened?

    No real and valid studies were performed over the two decades that ca. had in front of it since it legalized cannabis in 1996. The state had lots of time to properly address all of the aforementioned concerns that the current law touts it holds dear as it relates the public’s concern. But, this group that put the law together never had the public’s concerns in mind. Just their own. But, utilizing all the usual catch phrases to make it look like the whole thing was being put together to benefit the ca. citizenry. To make it sound good. Nothing could be further from the truth. All of these “bandage” fixes are solely meant to shore up and to cover up the inherent flaws that were already baked in to the law. That were already known. The fixers of the law just allowed a little time to go by before they began asking for more tax payer dollars; not to protect the public/serve the public in any real sense, but to protect their $$ interests, on the public dole. It’s ALL politically driven. Not evidenced based. But, this group is willing to continue to ask for public funds to destroy other peoples live’s to protect their unearned interests.

    The legislature and others that are in power to fund/defund bureaucracies such as this one, really need to ask for the data ( factual ) first. And to understand what that all means. Start with the Dept. of Finance. It shouldn’t be difficult to understand. If the data doesn’t make sense, or it seems that this kind of nickel and dining of the ca. taxpayer over a program such as this can’t prove in any real sense that the efficacy of such expenditures is going to solve a specific problem ( more likely to create a need for even more tax payer dollars.. ); the answer is clear: You don’t fund that agency. If that agency wants to stay alive, they need to go back to the drawing board. Maybe, take into consideration what the public was demanding so clearly in the first place. ( The publics’ concerns were largely ignored during the period the law was being drafted ). And not the special interest devised law/program that’s in place now. The way the things are with the economy and C-19, it seems that the answer should be pretty clear to the legislature as to where the priority needs to be.

  2. Faith Fidura on

    Wait…. so they only care that their taxes weren’t paid? These retailers aren’t facing consequences for operating an illegal business?

    • Pat on

      The short answer is: Yes. That’s all the gov. really cares about. I see all the folks that had their heart and MONEY in the right place before the rug got pulled out from under them… as legitimate rebels. So long as they aren’t harming anyone outside of not giving in to govt. corruption, which has been the product of this law. If the retailers or anyone else that gets caught not playing by the govt. rules…Let ’em got to court and set precedent. It shouldn’t be that hard. Then watch this B.S. law start to untangle itself, or just disappear all together.

      This law became a rat trap for most of its unwitting participants. A lot of them have been backing out once they caught wind of what they were being subjected to. The state gets paid first. IN FULL, mind you. If there’s ANYTHING left over.. Well, those crumbs are for you son. And, thanks for all your hard work! And sacrifice! For nothing,

      In Vietnam, the war was about enriching defense contractors and taking over another sovereign nation’s resources. Here, on a smaller scale you’ve got the same thing going on. A quagmire. When the establishment tacitly ignores fundamental concerns with regard to what its goals are; they’re and everyone else caught up in it, is in for a rough ride. In the end, who wins? The underworld POS that helped craft this law in concert with the state legislature. They win. They are a fraction of the ca. citizenry. Like 1/100 of 1%. Everyone else loses in some form or another. Some pay by losing their businesses, their families, their freedom, their very lives. It took 10 years of REALLY active campaigning and revolt ( at times violent ) by a much more educated, enlightened and motivated community than what we have now. So, it’s my guess that the manner of this groups’ revolt will be to cont. with business as usu. as if the law didn’t exist. And with a greater fervor than before because of the aforementioned. It’s all happening in plain sight. And those in gov. continue to ignore these facts, until it becomes so overwhelming/glaring, that the spotlight focuses on how we got here in the first place.

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