Time to Raise Pot Tax: San Jose Mayor

Activism Will Cost San Jose Marijuana Advocates

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    NEWSLETTERS

    Fox Business
    If San Jose's pot clubs want to change the city's rules, they'll have to pay for it with more taxes, according to San Jose mayor Chuck Reed.

    San Jose medical marijuana activists can fight the system. But they'll have to pay for it.

    Advocates for the city's medical marijuana dispensaries collected 49,000 signatures to put on the ballot a referendum overturning San Jose's strict limits on the number of pot clubs allowed in town.

    There are over 100; the new rules limit clubs to 10, and require the clubs to grow all their marijuana on-site, something they say they cannot do.

    Clubs also pay a seven percent local tax -- and Reed wants to up the tax to ten percent, to fund the cost of letting the voters decide on lifting the rules, according to the San Jose Mercury News.

    More than 94 clubs have paid tax to the city since a seven percent tax went into effect this year, a $2 million windfall for the city.

    Closing 84 of those clubs would cost the city money. And so would an election: going to polls would cost San Jose $1 million, according to Reed.

    Reed supports raising the pot tax to ten percent beginning in January.

    Advocates say that marijuana dispensaries already pay the highest taxes of any business, and that they would prefer to work with the City Council to create acceptable regulations.