Cal NORML participated in Cannabis Unity Coalition lobby day last week in Washington, DC to lobby for full cannabis decriminalization, release of federal marijuana prisoners, and the clearing of records for past marijuana convictions.

Watch the coalition press conference held at the US Capitol at which Cannabis Caucus Co-Chairs Dina Titus (D-NV) and Ilhan Omar (D-MN) spoke, along with Rep. Steve Cohen (D-TN). Read more.

Also speaking were representatives from Latino and Indigenous groups, prisoner advocates, Students for Sensible Drug Policy, NORML, MPP, DPA, and others. Information packets were dropped by Coalition members in all Congressional offices. In addition, 2,148 letters were sent to Congress in support of 44 organizations united around 13 bills, educating all 541 offices in the House and Senate.

Cal NORML’s director Dale Gieringer and deputy director Ellen Komp met with staffers for several Congressmembers, and Senators Adam Schiff and Alex Padilla. We even got a personal moment with Rep. Lateefah Simon (D-Oakland), Senator Schiff, and Rep. Titus. Staffers were interested to hear about the potential effect of the recent rescheduling order on California consumers and businesses.

At a California Constituent Coffee with Sens. Schiff and Padilla, Ellen had asked for both of them to sponsor this year’s expected Senate version of the MORE Act to fully deschedule cannabis, pointing out the pitfalls of partial rescheduling for recreational states like CA.

Californian Jackie Simion from NCIA thanked the Senators for their attention to the issue, and asked the Cannabis Unity contingent to raise their hands in a show of force. We all got a group photo with the Senators (above).

Kristi Kem of Freedom Grow spoke about the effective 70% tax rate on cannabis businesses in California, and about prisoner Pedro Moreno, currently serving a life sentence in Atwater, CA for a cannabis offense, one of 3000 federal cannabis prisoners still incarcerated.

“This was never just about one week,” writes Kat Murti, executive director of SSDP. “Cannabis Week of Unity was a launchpad for ongoing coordination, advocacy, and movement-building. We are just getting started, and the relationships, momentum, and visibility built this week will continue to power our work moving forward.” Cal NORML is following up with California-based members of the unity coalition, working towards reform efforts in our state as well as federally.

LAST UPDATED 6/26/2026

Cal NORML is tracking the following bills and has reached out to authors’ offices and stakeholders.

AB 1826 (Lackey; Coauthors: Chen and Hadwick). To improve due process around the recall, embargo, and destruction of cannabis products. Sponsored by CCIA. Passed Assembly and Senate Com. on B. P. and E.D. Heading for Appropriations. Cal NORML has joined a sign-on letter in support of this bill.

AB 1965 (Sharp-Collins) Cannabis: testing: quality assurance. Passed Assembly. Heading for Senate Com. on B. P. and E.D. hearing on 6/29. Cal NORML has sent a letter in support of this bill.

AB-2249 (Irwin) Cannabis: labels, packaging and manufacturing. Passed Assembly and Senate Com. on B. P. and E.D. Referred to Appropriations; hearing set for 6/22.
The Dept. of Cannabis Control (DCC) estimates annual costs of approximately $3 million to $4 million from the Cannabis Control Fund, explaining the majority of costs are associated with implementing a pre-approval process for cannabis labels and the expansion of prohibited imagery in advertising and marketing. A smaller portion of estimated costs are attributable to expansions of prohibited packaging design content.

AB-2532 (Irwin) Cannabis: labels, packaging and manufacturing (beverages). Passed Assembly and Senate Com. on B. P. and E.D. Referred to Appropriations.
An amendment added on 5/7 says, “If the cannabis product is a cannabis beverage containing more than one serving, the bill would require a consumer to be offered, at the time of purchase and at no additional charge, a measuring instrument or measuring device that allows the consumer to measure a single serving for consumption.”
Cal NORML has taken a neutral position on this bill following the news that amendments have been worked out with the cannabis industry removing the 10 mg cap on beverages and requiring industry-wide precision dosing and product identification features on all multi-serving cannabis beverages, warning label standards, child-resistant container requirements, while prohibiting single-serve marketing and supporting a funded, statewide campaign on responsible, informed cannabis beverage consumption, potentially modeled on alcohol responsibility campaigns. We will be continuing to follow this bill as amendments are published. Thanks to all who have taken our Beverage Safety survey; you can continue to provide input there. 

AB 2250 (Aguiar-Curry) Modify AB 8 to exclude CBN from the definition of cannabis concentrate. Passed Assembly and Senate Coms. on B. P. and E.D.;  REV. and TAX. Referred to Appropriations. Set FOR Hearing ON 03-AUG-26 10 a.m.

AB 2506 (Hart) Cannabis: tribal-state agreements. Passed Assembly. Referred to Senate Com. on B. P. and E.D. for hearing on 06/29/26.
Would allow the Governor to enter into agreements on behalf of tribes with CA licensees, other states authorizing medicinal or adult-use commercial cannabis activity, and foreign licensees, subject to “federal approval or toleration” of cross-border commerce. The amended language mimics SB 1326 (Caballero, 2021/22) which authorizes Gubernatorial agreements between other states and countries, should the US DOJ issue an opinion “allowing or tolerating interstate transfer of cannabis.”

AB 2537 (Chen) Cannabis Enforcement Accountability and Public Health Prioritization Act of 2026. Passed Assembly and Senate Com. on B. P. and E.D.; referred to Appropriations. Set FOR Hearing ON 03-AUG-26 10 a.m.
Would “require the DCC to prioritize its enforcement of MAUCRSA in a manner consistent with a risk-based enforcement framework that focuses on material threats while applying less intensive and less punitive measures on minor technical or administrative violations by licensees.” Sponsored by CaCOA.

AB 2697 (Pellerin) Cannabis drive-throughs. Passed Assembly and Senate Com. on B. P. and E.D. Referred to Appropriations.
Would authorize a local jurisdiction to allow a licensed cannabis retailer to conduct sales or deliveries at a drive-through, pass-out window, or slide-out tray, if the sales and deliveries are made through a fixed-pane security window with a security drawer.
TAKE ACTION: Write to your California Senator in support of AB 2697.

AB 2667 (Hadwick) Vape products: household hazardous waste: advertising. Passed Assembly and Senate Committees on E.Q., B. P. & E.D. and REV. and TAX. Heading to Appropriations.
Would allow authorize hazardous waste collection facilities to mechanically disassemble vape pens and devices, and prohibit nicotine or cannabis vapes using certain branding to appeal to minors, packaged to conceal the nature of their use, or including interactive videogame capabilities. 

AB 1884 (Hadwick/Sharp-Collins) Interscholastic athletics: drug testing: suspensions: nicotine use. Passed Assembly Committee on Arts, Entertainment, Sports, & Tourism; hearing in Education committee cancelled at request of the author.
This bill has been amended to allow schools with drug testing programs to also test for nicotine, limit it to athletics, and require diversion instead of banning participation for a positive drug test. We will continue to watch.  

SB-1272 (Menjivar) – Local ordinances: administrative fines or penalties. Passed Senate and Assembly Com. on L. GOV. Referred to Appropriations.

BILLS NOT ADVANCING:

AB-2420 (Caloza) Cannabis: donations: seniors. Authorizes cannabis retailers to donate cannabis or cannabis products to persons 65 years of age and older. 14-APR-26 hearing in Asm. B & P cancelled at request of author.  

AB-2617 (Schiavo) NO LONGER A CANNABIS BILL. It’s now the Protecting Kids from Online Gambling Act.

AB-2246 (Wicks) NO LONGER A CANNABIS BILL. It’s now the Youth Social Media Protection Act: report.

A “joint” hearing

Chair of the Joint Legislative Audit committee John Harabedian (D-Pasadena) opened the hearing and turned it over to Asm. Jacqui Irwin (D-Ventura) who requested an audit of cannabis packaging last year. The audit determined that laws and guidance are not always clear on what constitutes a package that is attractive to children, and that the DCC’s enforcement against companies with repeated violations was lacking.

DCC’s regulations prohibit cartoonish characters on cannabis packages, but examples were shown of gummy packages that arguably had such images, as well as those with images of marshmallows or candies and sweets like fruity rice, all of which had been determined to be within the agency’s guidelines. Also shown were bottles of drinks containing 100 mg of THC—ten times the standard adult dose—that provided no mechanism to consume a lower dose. It was recommended that CA either limit drink packages to 10 mg, unless a device is included to measure dosages.

Asm. Irwin pointed to increases in Poison Control Center calls and emergency room visits involving children ingesting cannabis, saying they are coming not just from the illicit market but also the legal, regulated one. It was pointed out that some of steepest increases in poison control center calls came after 2019 when hemp was descheduled at federal level and intoxicating hemp products proliferated. Also, it’s hard to distinguish if calls were coming from products on legal or illegal market. But Irwin kept coming back to, but some of the problems are from the legal market, to which DCC’s Christina Dempsey replied, certainly and said her department has taken steps to better coordinate and take action against violators.

Dempsey said the state audit happened during period where staff were still being combined from three different agencies that formerly regulated cannabis in CA. DCC has spent time developing a tool that will scan labels and highlight what staff might miss, she said, adding that in some cases it’s not obvious what’s attractive to youth. The agency is getting ready to roll that out their tool to licensees this summer.

DCC would love to have more inspectors, Dempsey said, but they have resource constraints. The agency has budget proposals under consideration for additional legal staff to review complaints, and to consolodate licensing systems, which are still in two separate databases (down from three, when Prop. 64 first took effect).

“We need cannabis products to look more like the pasta aisle than the cereal aisle,” Harabedian said, noting this his children don’t ask for pasta in the grocery store, but they want every cereal they see. He and others also objected to the name Root Beer being used on drink cans, to which the response was that root beer float was the name of a cannabis strain.

Several committee members like Legislative Audit Vice Chair Cabaldon asked if statutory clarity was needed on products like “Krispy Rice treats”? Asm. Hart asked, is the definition of child-attractive packaging or enforcement the issue? (Answers were unclear.) Asm. Bauer-Kahan noted that we must support the legal market, “it’s making us safer.” But we must protect children.

Asm. Berman, chair of Asm. Business and Professions committee, asked why strain names are a problem, saying that they’re used on flower, not products. He noted that this year marks 10 years of legal cannabis in CA, but the industry is still struggling to meet its expectations. He held up a package that “looks like it’s straight out of Alice in Wonderland,” calling it unacceptable.

Dr. Lynn Silver, a pediatrician and CDPH task force on packaging co-chair, noted that almost none of recommendations from the task force’s 2024 have been implemented. Those recommendations included moving to plain packaging or a system like Oregon’s where packaging is pre-approved. California has been a national leader in reigning in flavored tobacco, Silver noted, and should take the lead here as well. She raised an objection to Snoop Dogg onion rings and said that $70 million went from youth programs funded by cannabis taxes to the DCC to address child-attractive packaging.

Caren Woodson of CCIA noted that Prop. 64 tax money was to go to education and prevention. “How about instructing parents about safe storage?” she asked, noting that children can’t get into licensed cannabis retailers to see packages and must be accessing them at home.

Amy Jenkins of CaCOA said her organization just put out a White Paper based on an audit of 161 popular products, which found that 62% were compliant, 10% were clearly out of compliance, and the rest were unclear. CaCOA recommends:
1. Define observable design features
2. Align DCC guidance with regulation
3. Focus enforcement where risk is highest

“Protection without undermining the legal market is possible,” Jenkins concluded. The most egregious examples of dubious child-friendly products come from the illicit market, which has no age gating. The legislature has made substantial investments in enforcement, and needs to do more at the illicit retail level, she said.

Irwin said she would like to see CaCOA’s white paper, and was glad the industry was willing to work together for more precision in labeling.

During public comment, Dr. Alisa Padon from the Public Health Institute, said that with DCC funding, her organization used a Content Appealing to Youth Index and found measurable features like psychedelic effects that appeal to teens. Usage remains lowest in places without retail sales, she said, so the legal market matters.

Sam Rodriguez, who represents vertically integrated cannabis farmers from the Santa Barbara county area noted that labels that reflect the region – mountains, rivers, surfers – promote the industry and tourism for the county. While agreeing that cannabis must be kept away from youth, he asked, “Please be prudent and don’t overreach.”

Irwin’s last packaging bill was opposed by Cal NORML and the California cannabis industry and was vetoed by Gov. Newsom as overly broad. It disallowed any kind of picture, such as a picture of a farmer, on packages. The Assemblywoman has introduced a bare-bones packaging bill that will soon be flushed out, it is expected, along with a bill addressing marketing practices.

California NORML and our supporters worked hard in 2022 to sponsor and pass 

Our bill became law on January 1, 2023 (BPC 2228.5), prohibiting physicians and health plans to have policies denying medical treatment to qualified patients with a recommendation to use medical marijuana. The only exception is if a clinical determination is made on a case-by-case basis that a “medically significant” contraindication exists. The law further states, “The use of medical cannabis that has been recommended by a licensed physician and surgeon shall not constitute the use of an illicit substance in the evaluation described.” See a Fact Sheet about the law.

Unfortunately, we have continued to receive complaints from Kaiser patients who are being denied health care for using cannabis since the law took effect. This seems to impact pain patients the most, despite numerous studies demonstrating that the use of cannabis can lessen a patient’s need for prescription painkillers, and that access to medical cannabis lessens the rate of opiate abuse and overdose. Kaiser continues to drug test pain patients and prohibit its doctors from prescribing certain medicines if a patient tests positive for cannabis as a blanket policy, in direct violation of the law. We are also hearing from patients who have been denied surgery due to a positive drug test for THC.

Cal NORML is working demanding Kaiser change its policy in accordance with state law, for which we need a critical mass of patients to tell us their stories. All information will be kept confidential and anonymous, unless you give us permission to share it. 

IF YOU HAVE BEEN DENIED MEDICAL CARE BY A KAISER DOCTOR DUE TO CANNABIS USE, WE WOULD LIKE TO INCLUDE YOU IN OUR EFFORT TO CHANGE KAISER’S POLICY. PLEASE WRITE TO ELLEN@CANORML.ORG WITH THE DATE AND OTHER DETAILS ABOUT WHEN YOU WERE DISCRIMINATED AGAINST BY KAISER. 

UPDATE 2/26/26 – The cannabis language in the bill has been erased, following opposition from some in the cannabis industry, concerned that it would open the door to broader shipping. 

UPDATE 2/20/26 – During a chat with Capitol Weekly, new DCC chief Clint Kellum said (@ 19:46 in), that direct-mail options for cannabis could be “quite beneficial” to consumers, noting that most people are getting goods via Amazon, etc. Kellum said that the cannabis consumer has “quite a confusing market to deal with, in that there’s not widespread access across the state, you have intoxicating hemp cannabinoids that aren’t allowed in the state but are allowed at the federal level that make their way in through direct-to-consumer efforts, so there’s quite a bit of confusion, and having more traditional lines like direct-to-consumer would be nice.” However, Kellum said we were a long way off from such a plan, due to federal law. 

1/25/26 – Asm. Patrick Ahrens (D-Silicon Valley) has introduced a bill, AB 1564, to allow for the shipment of certain medical products from specified cannabis license holders directly to patients. Ahrens’s attempt at the bill last year, AB 1332, passed unanimously in the Senate and Assembly last year; however Gov. Newsom vetoed it.

“While I appreciate the author’s goal of expanding patient access to medical cannabis, the proposed direct-shipping program would be burdensome and overly complex to administer,” Newsom said in his veto statement. “The Department of Cannabis Control (DCC) will need to revamp the California cannabis track-and-trace system, which will take significant resources and time. Moreover, this measure includes numerous restrictions on eligible products – many of which are unclear, overly narrow or unworkable, adding to the implementation challenge.”

As reported by Cannabis Business Times, according to a fiscal analysis of the bill from the Senate Appropriations Committee, the DCC estimated a one-time implementation cost of approximately $269,000 to modify the track-and-trace system, and ongoing annual costs of $472,000 to oversee shipments and ensure compliance with product restrictions. That annual cost represents less than 0.05% of what the state collected in taxable cannabis sales in 2024, according to the California Department of Tax and Fee Administration.

The bill would have allowed any microbusiness with an M-license whose licensed activities include retail sale, manufacturing, distribution, and outdoor cultivation may directly ship medicinal cannabis to a medicinal cannabis patient in the state. “Given that this measure allows just two businesses to ship medical cannabis directly to patients, the costs of administering this program far outweigh the possible benefits to patients,” Newsom claimed.

Dr. Laurie Vollen testified in favor of A.B. 1332, saying that 29 years after medicinal marijuana was legalized in California, “medicinal products have become virtually extinct in today’s cannabis marketplace. Long-term patients cannot find any of the products that they were using effectively five years ago. No dispensary or delivery service has a full complement of medicinal products suitable for serving the needs of a variety of cannabis patients, especially cannabis-naive patients desperately seeking to begin alternatives to dangerous and addictive pharmaceuticals.”

The legislation as written would limit product shipments to cannabis flower and tinctures manufactured with non-volatile solvents, mechanical extraction or infusion only, sent by common carriers like FedEx or UPS. Ahrens had included a three-year sunset provision in A.B. 1332 in an effort to allow lawmakers to revisit its effectiveness. The new bill AB 1564 extends that date out to January 1, 2030. More revisions are expected.

In his 2025 veto statement, Newsom said he remains open to working with state lawmakers to adopt strategies to effectively advance equitable access to safe medical cannabis. Some 57% of California cities and counties still prohibit retail cannabis businesses, according to the DCC.

“I need the shipping bill,” wrote one Cal NORML supporter.  “I live in a legal cannabis desert, which creates both logistical and financial burdens for obtaining my necessary medication.”

Tell us: How might cannabis shipping benefit you? 

Efforts to reform federal cannabis laws remain stuck on hold in Washington, D.C. 

There is no indication as to whether the administration plans to move marijuana from Schedule I to III, as proposed by the Biden administration in April 2024. The DEA’s leadership has expressed skepticism about the proposal and has been sitting on it ever since. President Trump is reported to have privately indicated his interest in rescheduling to cannabusiness interests. However, his advisors are thought to have mixed views. In August, Trump declared that he was actively reviewing the question and would reach a decision in “the next few weeks.” So far he has failed to act.

NORML believes that cannabis should be de-scheduled, not re-scheduled, in order to become federally legal. That said, Cal NORML supports rescheduling to Schedule 3 as an interim measure. A major advantage of Schedule 3 classification would be to relieve canna-businesses from the IRS Section 280e tax provision, which bars them from claiming most business tax deductions. The 280e taxes have been estimated to cost as much as 25% of business revenues. Schedule 3 would be a major financial boon to the legal cannabis industry, which is struggling to break even and compete with illegal traffickers (Schedule 2 would not provide 280e tax relief, however). Rescheduling would in no way change the illegal status of state-legal cannabis under federal law. Only FDA-approved Schedule 3 cannabis pharmaceuticals could become legal. Such products would take years to develop and would likely be far more expensive than home-grown or dispensary-bought cannabis.

There appears to be no chance of any action to legalize or de-schedule cannabis in the current Congress, whose conservative Republican leaders – Speaker Mike Johnson of Louisiana and Sen. John Thune of South Dakota – have long been hostile to the idea. More modest reforms, such as safe banking legislation to facilitate access to financial services for canna-businesses, have languished for lack of support in Congress.

To the disappointment of veterans, an amendment to let V.A. doctors recommend medical cannabis was dropped from the budget bill. Instead, the bill included a last-minute amendment to ban psychoactive hemp products, a popular choice in states without legal adult-use cannabis laws. Hemp advocates, led by Sen. Rand Paul (R-KY) and Rep. Nancy Mace (R-S.C.), are seeking to reverse the hemp ban. (Read more.)

As in previous years, the Congress approved a budget amendment to prevent the Department of Justice from interfering in state medical marijuana laws. Efforts to extend the ban to protect adult-use laws have fallen short. Congress has likewise continued to block the District of Columbia from establishing adult-use dispensaries, although they were authorized by DC voters.

The first Trump administration rescinded Obama’s Cole Memorandum, which instructed prosecutors to refrain from targeting state-legal marijuana businesses. Now, the DOJ has announced that it will no longer ignore marijuana possession offenses on federal land such as national parks. The U.S. attorney for Wyoming has announced that such offenses will henceforth be “rigorously prosecuted.”

With action in Congress stalled, cannabis advocates have turned to the Supreme Court, which will be hearing a challenge to the federal ban on gun ownership by marijuana users. The court will be reviewing an appellate court ruling that overturned the conviction of a Texas man charged with a felony because he had a gun at his home and was an acknowledged regular cannabis user. The appeals court dismissed the conviction on the grounds that a blanket ban on gun ownership for illegal drug users would violate the Supreme Court’s Bruen decision, which expanded the right to own firearms. NORML attorneys are submitting an amicus brief in support of Second Amendment rights for cannabis users.

In another case, the Supreme Court has been asked to review the constitutionality of the federal law against cannabis in states where it is legal. A group of cannabis companies have petitioned the court to reconsider its 2004 decision in Gonzalez v Raich, which declared that the Controlled Substances Act overrode California’s law protecting medical marijuana users on account of the federal government’s interest in preventing interstate commerce in marijuana. Petitioners argue that “changed circumstances,” including federal prosecutors’ de facto tolerance of state legalization laws, militate for reversing Gonzalez v Raich.

This article is from Cal NORML’s year-end newsletter. Support Cal NORML and receive our newsletter by becoming a member today. 

Six cannabis-related bills made it through the legislature this year and four were signed into law, while ten failed to advance.

A bill from Asm. Haney to rollback cannabis taxes that Cal NORML sponsored became law, as did bills to regulate hemp from Asm. Aguiar-Curry and Sen. Wiener, and a bill from Asm. Ahrens to reduce the regulatory burden on cannabis research. The Governor vetoed a bill to expand local enforcement against cannabis, and a bill from Asm. Ahrens that Cal NORML support to allow microbusiness to ship certain cannabis products directly to patients.

KEY BILL

AB 564 (Haney) – Cal NORML-sponsored bill to roll back the cannabis excise tax increase from 15% to 19% on October 1, 2025. As amended, the rollback is in effect until July 1, 2028.  Signed into Law!

HEMP BILLS

AB 8 (Aguiar Curry) – intends to enhance the viability of cannabis licensees in the marketplace by pursuing measures to relieve tax and regulatory requirements, and to authorize licensees to manufacture, distribute, and sell hemp and cannabidiol (CBD) products in compliance with current law. Signed into law. 

ENFORCEMENT BILLS

SB 378 (Wiener) – would impose strict liability for damages caused to the consumer on an online marketplace that facilitated the connection between a consumer and an unlicensed seller of a cannabis or intoxicating hemp product. Signed into law. 

AB 632 (Hart) – would have authorized a local agency to file a final administrative order or decision for payment of fines or penalties related to unlicensed commercial cannabis activity for immediate judgment in the superior court of any county in California. The bill would also authorize a local agency to, by ordinance, establish a procedure to collect administrative fines or penalties by lien upon the parcel of land on which the unlicensed commercial cannabis activity occurred. Vetoed by the Governor, citing concerns about giving local governments more power to place liens on personal property. 

MEDICAL BILLS

AB 1332 (Ahrens) – would authorize a licensed microbusiness with an M-license to directly ship medicinal cannabis to a patient in the state. Vetoed by the Governor, citing the cost for DCC to implement a new cannabis tracking system, and inviting supporters to resubmit a bill to meet patients’ needs. 

AB-1103 (Ward) – Controlled substances: research. Would revise and recast provisions requiring the Research Advisory Panel to review research projects on Schedule I or Schedule II controlled substances. The bill was supported by Cal NORML and by the state Center for Medicinal Cannabis Research, whose research projects have suffered untoward delays due to RAP-C red tape. Signed into law. 

BILLS THAT DID NOT ADVANCE OR BECAME TWO-YEAR BILLS: 

AB-998 (Hadwick) – classifies cannabis vape pens, among others, confiscated at schools as household hazardous waste for disposal purposes. Held in Senate Appropriations. 

AB 1496 (Blanca Rubio) – would reinstate the cannabis task force and expand it to include representatives from tribal governmental entities regulating commercial cannabis activity that opt to participate in the task force. Passed Assembly. First Senate hearing canceled at the request of author.

AB 1027 (Sharp-Collins, Hadwick) – Cannabis: testing: quality assurance. Would require a licensed testing laboratory to comply with a DCC request to evaluate the laboratory’s testing practice. Held in Senate Appropriations. 

AB-686 (Berman) – Cannabis: appointees: prohibited activities. Ordered to inactive file. 

AB-762 (Irwin, Wilson) – to prohibit disposable, battery-embedded vapor inhalation devices

SB 501 (Allen) – to put vape pens into the Plastic Pollution Prevention and Packaging Producer Responsibility Act, requiring manufacturers to ensure the safe and convenient collection and management of those products at no cost to consumers or local governments.

AB-1065 (Ortega) – to enact the Consumer Inflation Reduction and Tax Fairness Act, requiring that cannabis taxes and others not be included in calculating fees charged by credit card companies.

AB 1209 (Michelle Rodriguez) – to require an employer that is licensed or is required to be licensed under MAUCRSA annually to provide proof that it has secured payment of workers’ compensation.

AB 1397 (Flora) – to authorize a hemp manufacturer to produce and sell low-dose hemp drinks if they contain no greater than 0.5 milligrams of total THC per container, and are tested by an independent testing laboratory. It would prohibit a low-dose hemp drink from being sold to or consumed by an individual under 21 years of age and impose an excise tax of 10%. 

SB 479 (Arreguin) – Cannabis: licensing: payment of goods and services.

Support Cal NORML’s efforts to watchdog and support, oppose or amend cannabis bills in California by making a membership donation today! We are entirely funded from donations made from within California. 

Governor Newsom has signed the Cal NORML-sponsored bill, AB 564 (Haney), to roll back the cannabis excise tax increase that happened on July 1 from 19% back to 15% on October 1, 2025.

Thanks to all Cal NORML’s supporters who helped lobby for the bill (including at our Lobby Day in March), and all who wrote letters via Cal NORML’s Action Network.

Support Cal NORML’s efforts to stop a tax increase in California by making a membership donation today! Business Memberships starting at $50 monthly include a directory listing and other perks.

Cal NORML focused on AB 564 at our March 24 Lobby Day in Sacramento, and has worked since then to secure necessary votes in favor of the bill in the Assembly and Senate. A pair of NORML Action Alerts, one pointing out the vast overtaxation of cannabis compared to comparable products, and a second pointing out that failed businesses don’t pay taxes, generated over 10,000 letters to lawmakers in support of the freezing taxes.

Cannabis Is Taxed At a Much Higher Rate Than Comparable Products

California raised its excise tax on cannabis from 15% to 19% on July 1, 2025.

Cannabis was already heavily over-taxed relative to comparable products like beer, wine, and tobacco in California.

The excise tax on one average, noninfused cannabis pre-roll is $1.24. In contrast, the excise tax on one glass of wine is $.01; a glass of beer $.02, a shot of liquor $.05-.08, and a tobacco cigarette $0.14. Adding in state sales tax and local taxes, cannabis products are taxed at a rate as as high as 38% (44% if delivered), and since taxes are compounded at the retail level, increasing the excise tax to 19% will increase the total tax to as much as 48%, roughly adding another $5 in taxes onto a $100 purchase, on top of the $38–$44 consumers are already being charged.

Cannabis taxes currently contribute more to California’s coffers than do alcohol taxes, despite far less sales. Gov. Newsom’s 2023/24 budget estimated an income of $440 million from alcohol taxes. By contrast, state excise taxes on cannabis brought in $624 million in 2023.

Any tax increase negatively impacts cannabis consumers and businesses in California.

Cannabis needs a tax decrease, not an increase.  The California cannabis industry is struggling to compete against overtaxation, the illicit market, resistance to local licensing, and the proliferation of hemp-derived products. Medical marijuana patients in particular are unable to meet their needs for cannabis products under current pricing. Initial impacts of the July 1 cannabis tax increase can already be felt by businesses and consumers.

Failed Businesses Don’t Pay Taxes

California’s cannabis market has lost 30% of its active licenses in the past two years

Inactive cannabis licenses are climbing as California companies struggle to stay in business. Inactive licensees don’t make money, or pay taxes. Many of the inactive licenses are equity businesses, who are already facing a de facto tax increase as the vendor compensation program for cannabis equity businesses is set to expire on 12/31/25.

California’s licensed retail footprint has flatlined at roughly 1,225 active stores since mid-2023, as 57% of the state’s cities and counties still prohibit cannabis dispensaries, according to the California Department of Cannabis Control (DCC).

6 out of every 10 cannabis sales in CA is from the illicit, untaxed market

A new report from the CA Department of Cannabis Control estimates that total California cannabis consumption is 3.8 million pounds, and that only 1.4 million pounds is sold from the licensed market. This means the majority of cannabis sold in California is untaxed. High tax rates in the licensed market are a big reason consumers look elsewhere for their cannabis.

Total excise tax collected in calendar year 2024 was $593.6 million compared to $626 million in calendar year 2023. Cannabis tax revenues peaked in fiscal year 2021-22 at over $800 million.

Total cannabis tax revenue from the fourth quarter 2024 was $219 million, including $127.8 million in excise taxes and $91.2 in state sales tax, according to the CDTFA. This is down 13.7% from the total $253.8 million in the third quarter. The excise tax dropped 14.9% from $150.1 million.

California lost 17,600 cannabis jobs in the last two years

California led the nation with 12,600 cannabis jobs lost in 2023 and 5,000 cannabis jobs lost in 2024, according to industry employment agency Vangst.

Other states with lower taxes outperform CA’s cannabis sales

Michigan, with its 10% state excise tax that is shared with local jurisdictions (which have no taxes of their own), is pointed to as a model for a successful roll-out of marijuana legalization. Missouri has a 6% state excise tax and caps local taxes at 3% (California has no such cap).

If California were on par in per capita sales with Michigan or Montana, it would be generating an estimated $13 billion in annual sales, and the state would be collecting substantially more tax revenue. Instead, the taxable sales for cannabis in 2024 was $4.6 billion. Source

Adding in state sales tax and local taxes, cannabis products are taxed at a rate as high as 38% (44% if delivered) in California. Since local taxes are compounded at the retail level, including packaging and service fees, increasing the excise tax to 19% will increase the total tax on cannabis to as much as 48%. This is far more than comparable products like beer, wine and cigarettes.

Please take action to support AB 564.

The Cannabis Tax Account Has a Budget Surplus

In fiscal year 2023-2024, the Cannabis Tax Account had a balance of $469.6 million and took in $629.4 million in taxes, according to the DCC’s Condition and Health of the Cannabis Industry in California supplemental report. But it spent only $560.5 million because legislators contributed $150 million from the general fund. For this fiscal year, estimated revenue is $603.7 million and expenditures are nearly $674.0 million, leaving a balance of $468.2 million.

For fiscal year 2025-26, the governor’s budget projects that cannabis tax revenues will be about $761.9 million, assuming the excise tax will increase to 19% on July 1. Expenditures are budgeted at only $610.2 million.

Who is Opposing a Cannabis Tax Freeze? 

AB 564 is being opposed by groups that receive cannabis tax money for Youth Education Treatment and Prevention Programs, which have not been evaluated for their effectiveness, despite legislation requiring accountability.

In 2022, Governor Newsom signed AB 2925  (Cooper), requiring DHCS to provide to the Legislature by July 10, 2023 a spending report of funds from the Youth Education Prevention, Early Intervention and Treatment Account (YEPEITA) paid for by the Cannabis Tax Fund for the FY 2021–22 and 2022–23. In addition, the 2022 Budget Act stated that by March 1, 2023, and on the same date until 2025, the DOF shall submit a report to the Legislative Analyst’s Office, relevant policy committees, and the relevant budget committees of each house of the Legislature on Cannabis Tax Fund Spending.

Both AB 2925 and the 2022 Budget Act called for evaluations of YEPEITA programs, with AB 2925 stating: “The departments shall periodically evaluate the programs they are funding to determine the effectiveness of the programs.” Although DOF has provided some data in Budget Committee hearings about YEPEITA program expenditures, that data is incomplete, and no evaluations of the programs have been provided by DHCS.

Cal NORML put out word through our email alert list this week asking cannabis consumers and businesses to tell us about the initial impacts of the 26% excise tax increase that hit cannabis in California on July 1. Several consumers and businesses reported damaging repercussions; some of the responses are below.

“To be honest even the old tax had me wanting to go back to the black market but with the new tax it’s even more likely that I will start looking to get my cannabis from some place cheaper,” wrote one consumer. Another wrote, “I drive to Oregon to buy it instead. I’m retired on an extremely small income.” A man from Yolo county who drives to downtown Sacramento for his cannabis writes that with the tax increase, “What I’m able to afford won’t last. This tax is excessive, and blatantly targets the lower income and fixed income medical and recreational users.” Someone from Duarte wrote, “Sure hope the tax gets repealed–I can’t consume anymore due to the insane taxes.”

“The additional taxes, on top the already high taxes on cannabis (higher tax rates than anything else I buy) means I will purchase less from licensed dispensaries,” wrote one Marin county consumer. She added, “I (as well as everyone I know) want to be law abiding and want to support local businesses however I have financial limits and also do not want to be taken advantage of–which is certainly what these new taxes feel like. It’s like the State is trying to destroy the legal cannabis business–because excessive taxation will only drive people to deal with unlicensed sources.”

On the business side, Kevin Reed of The Green Cross in SF writes, “Even in this short window, we’ve had regulars voice frustration about pricing, particularly on items they purchase frequently. We’re anticipating further downward pressure on basket sizes, and the increased cost is likely to drive more price-conscious consumers back to the illicit market unless something changes.”

Jennifer Copenhaver, Human Resource Manager at A Therapeutic Alternative in Sacramento writes, “We want to give our employees stable jobs. They have families. We want to serve our community. But we cannot absorb this 4% AND do all of those things. Instead, we collect the tax, as required, from our customers. As a result, many are upset with paying more and we will lose some. Either way, we will lose money. How much is yet to be quantified….Given that consumers are already watching every penny due to increased costs for rent, food, gas, and healthcare, at least some percentage of consumers will be much more likely now to seek cannabis outside of the taxed market before simply accepting the higher taxes. Some just won’t be able to afford not to.”

Jennifer Pratt from ATA added, “The increase from 15% to 19% may appear modest on paper, but for patients who are already navigating financial and medical hardship, it has been devastating. Many of our members were already at the edge of affordability—and now some have been forced to stop their regimens altogether. What’s most painful to hear is that some patients are now feeling pushed to return to the unregulated market. They are afraid—afraid of what they might be consuming, afraid that it won’t be the quality or formulation their condition requires, and afraid that they are losing control over the one treatment that had finally brought them some measure of relief. Cannabis is not a luxury for these individuals; it is medicine. For many, it’s the only effective option after exhausting pharmaceutical routes that failed to help or caused unbearable side effects. This tax hike doesn’t just affect access—it affects health outcomes, safety, and dignity.”

Annie Aubrey, CEO of Chuck’s Wellness Center in Placerville writes, “With inflation and current economic struggles, we are seeing a dramatic decline of over 20% in the customer spend in the last year. The customers have always expressed heavy disdain for the high taxes on the cannabis products, and are very upset with us that the increase went through this last week. Many continue to supplement their cannabis purchases from sources other than legal retail dispensaries. Consumers do not find excessive taxes in the hemp or illicit market and find excessive taxation of the legal market. That needs to change! The city and state do not gain revenue from these alternative markets either. These products are not safe and scare people from our products and continue to hurt our industry.”

David Hudson wrote, “I work for KSS, which distributes 28 brands to retailers throughout California and this tax increase has led to retailers asking for additional discounts on all products to be able to maintain the price of goods on their shelves. Licensed retailers are already extremely price sensitive and a common concern seems to be that this tax will drive the prices up and will then drive consumers away from their stores (and possibly back to the traditional market).  This is putting pressure on the entire supply chain, as retailers are now asking for KSS and its suppliers to provide deeper discounts, and therefore work on thinner margins. Most cannabis suppliers are barely profitable (if profitable at all) so this only adds more pressure on the entire supply chain.”

On top of the 4% state excise tax hike, the city of Berkeley enacted a 5% tax on purchases on July 1, when efforts to extend their tax moratorium failed. Other cities are lowering their cannabis taxes to help out struggling cannabis businesses, while the state continues to gobble the largest portion of the pie.

Meanwhile, a new report shows that Michigan, with its lower tax rate, is about to overtake California in cannabis sales.

AB 564, the Cal NORML-sponsored bill to roll back the cannabis tax hike passed the Senate Revenue and Taxation committee by a vote of 5-0 on July 9. It will be heard in Senate Appropriations on or after August 18, when the legislature reconvenes after its summer recess.

UPDATE July 9, 2025 – On the 50th anniversary of cannabis decriminalization in California, AB 564 passed through the Senate Revenue and Tax committee, its first stop in the Senate after passing in the Assembly by a vote of 74-0. An amendment would roll the tax back from 19% (enacted on July 1) back to 15% on October 1. It will next head to the Appropriations committee, sometime after the legislature reconvenes after its summer break on August 18. Thanks to all who have taken action and continue to do so!

WRITE TO GOVERNOR NEWSOM AND ASK HIM TO SIGN AB 564 TO REPEAL THE CANNABIS TAX INCREASE 

Retailers: Download our new flyer with QR code for your customers to take action. 

Support Cal NORML’s efforts to stop a tax increase in California by making a membership donation today! Business Memberships starting at $50 monthly include a directory listing and other perks.

Cal NORML Leads the Charge

“California NORML is proud to have taken a leadership role sponsoring this bill,” California NORML Director Dale Gieringer said. “Cannabis is already heavily over-taxed relative to comparable products like beer, wine, and tobacco in California.”

In March, Cal NORML organized coordinated a lobby day and press conference at the state capital in support of AB 564, bringing together a coalition of groups including the United Food and Commercial Workers – Western States Council, the California Cannabis Industries Association, and others.

A pair of NORML Action Alerts, one pointing out the vast overtaxation of cannabis compared to comparable products, and a second one aimed at incorporating AB 564 into the budget process, have generated over 8,000 letters to lawmakers in support of the freezing taxes.

Support Cal NORML’s efforts to stop a tax increase in California by making a membership donation today! Business Memberships starting at $50 monthly include a directory listing and other perks.

Failed Businesses Don’t Pay Taxes

California’s cannabis market has lost 30% of its active licenses in the past two years

Inactive cannabis licenses are climbing as California companies struggle to stay in business. Inactive licensees don’t make money, or pay taxes. Many of the inactive licenses are equity businesses, who are already facing a de facto tax increase as the vendor compensation program for cannabis equity businesses is set to expire on 12/31/25.

California’s licensed retail footprint has flatlined at roughly 1,225 active stores since mid-2023, as 57% of the state’s cities and counties still prohibit cannabis dispensaries, according to the California Department of Cannabis Control (DCC).

6 out of every 10 cannabis sales in CA is from the illicit, untaxed market

A new report from the CA Department of Cannabis Control estimates that total California cannabis consumption is 3.8 million pounds, and that only 1.4 million pounds is sold from the licensed market. This means the majority of cannabis sold in California is untaxed. High tax rates in the licensed market are a big reason consumers look elsewhere for their cannabis.

Total excise tax collected in calendar year 2024 was $593.6 million compared to $626 million in calendar year 2023. Cannabis tax revenues peaked in fiscal year 2021-22 at over $800 million.

Total cannabis tax revenue from the fourth quarter 2024 was $219 million, including $127.8 million in excise taxes and $91.2 in state sales tax, according to the CDTFA. This is down 13.7% from the total $253.8 million in the third quarter. The excise tax dropped 14.9% from $150.1 million.

California lost 17,600 cannabis jobs in the last two years

California led the nation with 12,600 cannabis jobs lost in 2023 and 5,000 cannabis jobs lost in 2024, according to industry employment agency Vangst.

Other states with lower taxes outperform CA’s cannabis sales

Michigan, with its 10% state excise tax that is shared with local jurisdictions (which have no taxes of their own), is pointed to as a model for a successful roll-out of marijuana legalization. Missouri has a 6% state excise tax and caps local taxes at 3% (California has no such cap).

If California were on par in per capita sales with Michigan or Montana, it would be generating an estimated $13 billion in annual sales, and the state would be collecting substantially more tax revenue. Instead, the taxable sales for cannabis in 2024 was $4.6 billion. Source

Adding in state sales tax and local taxes, cannabis products are taxed at a rate as high as 38% (44% if delivered) in California. Since local taxes are compounded at the retail level, including packaging and service fees, increasing the excise tax to 19% will increase the total tax on cannabis to as much as 48%. This is far more than comparable products like beer, wine and cigarettes.

Please take action to support AB 564.

The Cannabis Tax Account Has a Budget Surplus

In fiscal year 2023-2024, the Cannabis Tax Account had a balance of $469.6 million and took in $629.4 million in taxes, according to the DCC’s Condition and Health of the Cannabis Industry in California supplemental report. But it spent only $560.5 million because legislators contributed $150 million from the general fund. For this fiscal year, estimated revenue is $603.7 million and expenditures are nearly $674.0 million, leaving a balance of $468.2 million.

For fiscal year 2025-26, the governor’s budget projects that cannabis tax revenues will be about $761.9 million, assuming the excise tax will increase to 19% on July 1. Expenditures are budgeted at only $610.2 million.

Who is Opposing a Cannabis Tax Freeze? 

AB 564 is being opposed by groups that receive cannabis tax money for Youth Education Treatment and Prevention Programs, which have not been evaluated for their effectiveness, despite legislation requiring accountability.

In 2022, Governor Newsom signed AB 2925  (Cooper), requiring DHCS to provide to the Legislature by July 10, 2023 a spending report of funds from the Youth Education Prevention, Early Intervention and Treatment Account (YEPEITA) paid for by the Cannabis Tax Fund for the FY 2021–22 and 2022–23. In addition, the 2022 Budget Act stated that by March 1, 2023, and on the same date until 2025, the DOF shall submit a report to the Legislative Analyst’s Office, relevant policy committees, and the relevant budget committees of each house of the Legislature on Cannabis Tax Fund Spending.

Both AB 2925 and the 2022 Budget Act called for evaluations of YEPEITA programs, with AB 2925 stating: “The departments shall periodically evaluate the programs they are funding to determine the effectiveness of the programs.” Although DOF has provided some data in Budget Committee hearings about YEPEITA program expenditures, that data is incomplete, and no evaluations of the programs have been provided by DHCS.