2023 Sees Significant Changes to California Cannabis Retail Regulations

The Department of Cannabis Control’s new consolidated regulations and the passage of AB-195 will bring about several notable changes in California’s cannabis supply chain. The changes that will be implemented as of January 1st, 2023, aim to improve regulation and compliance of the cannabis industry and generate additional revenue for the state.

§15418: Cannabis Goods Carried During Delivery

This regulation change allows delivery operators to carry a greater value of cannabis goods during delivery, up to $10,000. Previously, this was limited to only $5,000 worth of goods per trip. Additionally, the regulations have removed the limit on carrying cannabis goods that have pre-ordered. This is a big step forward for the industry, as it means that dispensaries can now transport larger amounts of product in a single trip, saving them time and money on gas.

§15034: Significant Discrepancy In Inventory At Any Point In Time

Another notable change is that retailers may not have an inventory discrepancy of 5% or higher. This will now be measured by comparing your physical inventory to your inventory in Metrc.  While this is undoubtedly a welcome change, it does require some additional steps on behalf of retailers and their suppliers. Dispensaries need to ensure that their systems are equipped with accurate tracking software so that you can easily compare physical inventory against what’s reported in Metrc.

This change means that retailers can see their inventory discrepancies at a glance, and it will be easier to keep track of them. It also means that dispensaries can take immediate action if they find that they have an inventory discrepancy, which is essential because it helps ensure compliance with state regulations.

AB-195: Excise Tax Collection At The Point-Of-Sale

Under AB-195, cannabis retailers must collect the 15% excise tax from customers at the time of purchase. The excise tax will be charged on gross receipts. The revenue generated by this new excise tax will be used primarily to fund public safety and research programs. It will also help support educational efforts around cannabis consumption and its effects on health and behavior.

The tax previously collected and remitted quarterly to the CDTFA by distributors will now be the responsibility of retailers. They will have to work with a tax professional to calculate and compound sales tax on cannabis and non-cannabis products to ensure compliance.

§15407: Sale Of Non-Cannabis Goods

This regulation change clarifies that consumers who go to a cannabis consumption area may bring or receive non-cannabis-infused and non-alcoholic food and beverages for consumption in that area if allowed by the local jurisdiction. This means that customers will be able to eat their favorite snacks while they’re enjoying cannabis in a designated consumption area.

§15402: Customer Access To The Retail Area Via Curbside Pickup

Storefront retailers will be allowed to deliver goods and services through curbside delivery. This change will enable retailers to offer customers more convenience and flexibility in their purchases.

§15040.2: Prohibited Business Promotions

These new regulations also add that licensed retailers shall not give away any amount of cannabis or cannabis products, or any cannabis accessory, as part of a business promotion. This includes but is not limited to: raffles, giveaways, contests, drawings, and sweepstakes.

These changes will not only ensure that the cannabis industry is responsible and sustainable, but they will also help retailers strengthen their operations and customer satisfaction. Enjoyed that first hit? Come chill with us every week at the Friday Sesh for a freshly packed bowl of the week’s best cannabis news!