City to cut tax on cannabis growers

Desert Hot Springs is planning to make several changes aimed at boosting the city’s cannabis industry, including a permanent tax cut and allowing dispensaries to create spaces for customers to consume the products on site.

On Tuesday, the city council unanimously voted to have staff create on ordinance that allows the consumption spaces, reduces the tax for cultivation and adds a new license fee.

The council has been flirting with lowering cannabis taxes for some time. It has temporarily lowered taxes for cultivation and voted to have city staff draft an earlier ordinance that would have reduced that tax long term. But it later approved the ordinance in October without permanent tax changes to allow newly hired City Manager Frank Luckino a chance to make suggestions

How is the tax for cultivation changing?

The city’s tax for cultivation is $10.20 per square foot, but it was temporarily reduced to $5.20 and then to $7.50. The ordinance would permanently lower it to $5.75 and require monthly tax payments instead of every six months.

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