In January 2016, Los Angeles Municipal Code Section 21.50 (Taxation of medical marijuana collectives) was amended by the City to tax only existing medical marijuana collectives that are able to attest under penalty of law to compliance with Proposition D. The amendments provided, in part, that all existing medical marijuana registration certificates were invalid as of March 31, 2016.
Under the amended ordinance, renewals of existing registrations are allowed only if they are accompanied by an affidavit attesting to compliance with Proposition D. Submitting an affidavit with a false statement or displaying an expired, suspended or otherwise invalid business tax registration certificate is a misdemeanor.
The amendments to LAMC Section 21.50 are included below for reference.
(b) Every person engaged in operating or otherwise conducting a medical marijuana collective that attests under penalty of law to compliance with Proposition D and not otherwise specifically taxed by other business tax provisions of this Chapter, shall pay a business tax of $60.00 for each $1,000.00 of gross receipts or fractional part thereof. No new business tax registration certificates shall be issued for any medical marijuana collective business activity. Any medical marijuana collective that does not attest to compliance with Proposition D shall not be taxed under any Section of this Article for any medical marijuana collective business activity for tax year 2016 and forward. It shall be the burden of the medical marijuana collective to determine and accurately represent to the Office of Finance whether it complies with Proposition D.
(g) Every medical marijuana collective taxed by this section shall remit with its annual renewal of business taxes an affidavit in a form approved by the Director of Finance attesting to its compliance with Proposition D and such affidavit shall be subject to public disclosure. Any person who makes a false statement or representation in the affidavit is guilty of a misdemeanor. An updated business tax registration certificate in a form approved by the Director of Finance, further clarifying that such certificate is not a permit to operate a business, shall be issued to all medical marijuana collectives subject to tax as set forth in Section 21.50 (b). All medical marijuana collective business tax registration certificates in their current form shall be invalid effective March 31, 2016. A medical marijuana collective that remitted its annual payment of business taxes in 2016, before the effective date of this ordinance shall, before March 31, 2016, complete the affidavit attesting to its compliance with Proposition D.
(h) It shall be a misdemeanor for any person operating a medical marijuana collective as defined by Section 21.50(c) to maintain or display a business tax registration certificate for any classification other than that set forth in Section 21.50(b) for medical marijuana collective business activity or to maintain or display an expired, suspended or otherwise invalid business tax registration certificate.