Free Medical Marijuana for Californians and No More Taxes on Donors

California Gov. Gavin Newsom has signed SB 34, a bill that eliminates taxes on charitable donations of medical marijuana for patients with severe chronic illnesses.

Since California legalized the use of marijuana for medical purposes in 1996, not-for-profit compassionate care programs have helped ensure access to marijuana for low-income Californians. To support the programs, for-profit cultivators and retailers donated cannabis. Donations were tax-free. 

That changed with the passage of Proposition 64, the 2016 ballot measure that legalized adult marijuana use in California. Prop. 64 imposed a broad tax on cannabis suppliers and for-profit businesses. Swept up in the tax regime were charitable donations.

Cannabis flowers were taxed at $9.25 per dry-weight ounce and cannabis leaves at $2.75 per dry-weight ounce. The taxes applied to all cannabis, whether for donation or sale.

Governor Gavin Newsom signed the Dennis Peron and Brownie Mary Act over the weekend.

The Dennis Peron and Brownie Mary Act

The Dennis Peron and Brownie Mary Act (SB 34) corrects what its proponents saw as an overreach of California’s tax-and-regulate model. 

Senator Scott Weiner (D-San Francisco) co-authored the bill, which is the Senator’s second effort. A virtually identical bill, also introduced and co-authored by Weiner, was vetoed by former Gov. Jerry Brown in 2018.

Gov. @GavinNewsom signed #SB34, our legislation to ensure #cannabis compassion programs – which provide free medical cannabis to low income patients – can survive. These programs are critical to the health of many with #HIV, cancer, PTSD & other conditions. Thank you Governor!

— Scott Wiener (@Scott_Wiener) October 13, 2019

“Compassionate care programs aid people who are seriously ill and suffering,” said the Senator in a press release. “And we should be helping them thrive, not squeezing them with business taxes that are forcing many of them to close.”

SB 34 sailed through the House and Senate, with support from pro-marijuana lobbying groups like NORML and the Drug Policy Alliance. 

With Gov. Newsom’s signature, SB 34 is law. The bill will grant tax exemptions until 2024.  

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