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Council votes 5‑2 to raise non‑medical cannabis tax by 2 percentage points
Summary
The council approved a 2‑point increase in the city's non‑medical cannabis tax rate (applying to permitted retail dispensaries) after staff projected $125,000–$300,000 in additional revenue; the measure excludes legal non‑conforming medical dispensaries and prompted debate over market impacts and the risk of pushing consumers to illicit sellers.
The Santa Barbara City Council on March 17 approved an ordinance to increase certain cannabis tax rates, applying a 2 percentage‑point increase to non‑medical retail categories while leaving legal non‑conforming medical dispensaries at existing rates.
Assistant Finance Director Lindsey Moss summarized the city's position: voters approved cannabis taxes in 2016 and the council set rates up to a 20% cap in 2018. Staff emphasized the city’s cannabis tax revenue has declined from a peak of about $1.9 million in fiscal year 2021 to about $1.0 million budgeted for FY2026. Moss said HDL, a consultant that conducted local audits, recommended a modest 2% increase and cautioned…
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