By MICHAEL R. BLOOD, Associated Press
LOS ANGELES (AP) — California should use armored cars to transport hundreds of millions of dollars in cash tax payments expected next year with the state’s legal marijuana market, the state treasurer said Tuesday.
The state on Jan. 1 will enter a new era with cannabis when recreational sales become legal and join the long-standing medical industry in what will become the largest U.S. legal pot economy.
But the new market estimated to grow to $7 billion annually has a troubling flaw: Marijuana remains illegal under federal law, so most banks won’t do business with pot growers, manufacturers or retailers. That means marijuana companies typically operate only in cash, including their tax payments that will be 15 percent of sales to the state of California.
State Treasurer John Chiang formed a task force to work on a solution for gathering the money because the state expects to collect hundreds of millions of dollars from pot sales next year.
The armored car tax collection solution came about amid fears that operators carrying large bags of cash could be targets for theft and create problems for the state workers collecting and counting the money.