By now, anyone that reads our articles is certainly aware that we like the cannabis cooperative association [“CCA”] structure, its an amazing vehicle for small craft cannabis cultivators to pool their resources, save money and remain competitive in a market that is quickly filling up with large vertically integrated businesses. We have become incredibly frustrated with the reticence of CalCannabis to issue a license to a CCA other than one that is fo4Redacted RParrottLetter (2) engaged in cultivation or processing. One of the professionals we know that is active in seeking to get CCA’s licensed wrote a letter to Mr. George Parrott, the Director of CalCannabis. We are sharing a redacted version of that letter with everyone so that everyone becomes aware of where this situation stands. We intend to distribute this broadly in the hope that we can resolve this without litigation.

Before everyone recoils with the thought that this article is more of the same, permit us to promise it won’t be that. We have written extensively about what believe the regulatory and tax authorities could have done to have avoided the chaos pervasive in the the market today.

Everyone knows the maxim “Free advice is worth what you pay for it”  There are, however, exceptions.  Everyone knows a second maxim “The exception that proves the rule”  In this article, we provide free advice to the California Department of Tax and Fee Administration (“CDTFA”).  We are providing free advice which we believe is valuable.  Hence, our free advice in this article is an exception that proves on some occasions free advice should be followed. We can summarize this article with a simpler statement.  “Wake up CDTFA…You are leaving money on the table!”

In this article we will address solely the responsibility of the California Department of Tax and Fee Administration (“CDTFA”) for the shortfall in the projected tax revenue from cannabis.