California’s Dept. of Tax and Fee Administration has issued a cannabis tax fact sheet for calculating the cannabis excise tax. To properly calculate the 15% tax, cannabis distributors must determine whether the sale or transfer to the cannabis retailer is an arm’s-length or non-arm’s-length transaction. An arm’s-length transaction is defined as a sale, entered in good faith, between a cannabis retailer and supplier at a fair market value sales price in the open market between willing, informed participants. For more information contact us with questions, or see the CA fact sheet here: