California Cannabis Tax Rates in 2026
The California cannabis excise tax rate is 15% of gross receipts for retail sales occurring on or after October 1, 2025, and that is the rate in force as of August 2026. The excise tax is collected by the retailer from the purchaser and remitted to the California Department of Tax and Fee Administration (CDTFA).
The rate has not been static. A statutory adjustment tied to the repealed cultivation tax pushed the excise rate to 19% for the quarter running July 1, 2025 through September 30, 2025. Legislation then restored the 15% rate effective October 1, 2025 and delayed the next scheduled rate adjustment until fiscal year 2028–2029. Operators filing amended returns or reconstructing prior-period returns should apply the rate in effect on the date of each retail sale, not the current rate.
Excise tax is only one of three layers. Sales and use tax applies at the 7.25% statewide base rate plus any district taxes at the point of sale, and most licensed jurisdictions impose a separate local cannabis business tax. For the full accounting treatment of these layers, see our California Cannabis Tax Guide.
How the California Cannabis Tax Calculator Works
The calculator follows the order of operations a compliant California retail receipt uses. It starts with the product selling price, adds the local cannabis business tax you enter (applied to the product price), then adds any delivery fee and service or payment processing fee. That total is the gross receipts figure the 15% cannabis excise tax is computed on.
The excise tax is then added to that subtotal, because the excise tax is itself part of the measure subject to sales tax. Your entered sales tax rate is applied to the combined subtotal, and the result is the estimated total the customer pays.
Worked example: a $150 product with a 5% local cannabis business tax ($7.50), a $10 delivery fee and a $3 service fee produces $170.50 in gross receipts. Excise tax at 15% is $25.58, giving a $196.08 subtotal. Sales tax at 9.25% adds $18.14, for an estimated customer total of $214.21 — roughly 42.81% above the product price.
California Cannabis Excise Tax — 15% in 2026
The cannabis excise tax is a state-level tax imposed on the purchaser of cannabis or cannabis products in a retail sale, calculated on the retailer's gross receipts from that sale. Licensed retailers hold a cannabis retailer excise tax permit, collect the tax at the point of sale, and report and pay it to CDTFA on a quarterly return that is separate from the sales and use tax return.
Gross receipts is a broader measure than the shelf price. Amounts the retailer charges as part of completing the sale — delivery, service and processing charges, and local cannabis business tax passed through to the customer — generally form part of the measure. Cannabis accessories sold separately and clearly itemized are treated differently, which is one reason point-of-sale item mapping matters so much. Our dispensary accounting service exists largely to keep that mapping defensible.
California Sales Tax on Cannabis in 2026
California's statewide base sales and use tax rate is 7.25%. Cities, counties and special districts may layer district taxes on top of that base, so the actual rate applied at a given dispensary is frequently higher — commonly in the 8.25% to 10.75% range depending on location. Because the rate is address-specific, the calculator asks you to enter it rather than assuming one.
Critically, the cannabis excise tax is included in the amount subject to sales tax. Sales tax is therefore computed after the excise tax has been added to the subtotal, not in parallel with it. Retailers who configure their POS to compute both taxes off the same pre-excise base will under-collect sales tax and create an exposure that surfaces on audit.
Medicinal cannabis purchasers holding a valid Medical Marijuana Identification Card issued under the state program, together with a valid government ID, are exempt from sales and use tax on qualifying purchases. The excise tax still applies. This calculator does not model that exemption; set the sales tax rate to 0% to approximate an exempt sale.
Local California Cannabis Business Taxes
Cities and counties that permit commercial cannabis activity generally impose their own cannabis business tax, most often as a percentage of gross receipts for retail and distribution, and sometimes on a square-footage basis for cultivation. Rates, bases, filing frequencies and pass-through rules are set by local ordinance, and they differ materially between neighboring jurisdictions.
CDTFA does not administer these local taxes. They are filed with and paid to the city or county, on that jurisdiction's forms and calendar. That is why the calculator exposes the local rate as a user-entered field: publishing a fixed local rate would be wrong for most users, and stale within a budget cycle. Verify the current rate and the measure it applies to with the licensing jurisdiction before relying on any estimate.
Whether local tax is passed through to the customer or absorbed by the retailer also affects the gross receipts measure. The calculator assumes pass-through, which is the common retail configuration.
California Cannabis Tax Calculation Example
The following example is illustrative only and uses assumed local and district rates. Assume a delivery order of $200 in flower and edibles from a retailer in a city with a 6% local cannabis business tax, in a district where the combined sales tax rate is 9.50%, with a $12 delivery fee and a $4 payment processing fee.
- Product price: $200.00
- Local cannabis business tax at 6%: $12.00
- Delivery fee: $12.00
- Service fee: $4.00
- Gross receipts subject to cannabis excise tax: $228.00
- Cannabis excise tax at 15%: $34.20
- Subtotal subject to sales tax: $262.20
- Sales tax at 9.50%: $24.91
- Estimated total customer cost: $287.11
- Effective combined tax and fee load over product price: 43.55%
Enter the same figures into the calculator above to reproduce the result. Changing only the local rate or the district sales tax rate demonstrates how much of the final price is jurisdiction-driven.
California Cannabis Tax Changes: 2025–2026
- Through June 30, 2025 — cannabis excise tax at 15% of gross receipts.
- July 1, 2025 through September 30, 2025 — rate temporarily increased to 19%.
- Beginning October 1, 2025 — rate restored to 15%.
- Next statutory rate adjustment delayed to fiscal year 2028–2029; 15% remains in effect as of August 2026, and this calculator uses 15%.
Retailers that operated through the third quarter of 2025 should confirm their historical returns applied 19% to sales in that window and 15% before and after it. Reconstructing that period correctly is a recurring item in our California Cannabis Accounting Guide close procedures.
