California Code of Regulations › Title 18 - Public Revenues › Division 2 - California Department of Tax and Fee Administration- Business Taxes (State Board of Equalization- Business Taxes, See Ch. 6 and 9.9) › Chapter 8.7 - Cannabis Tax Regulations › Section 3700 - Cannabis Excise and Cultivation Taxes

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a)
				Definitions. For purposes of this chapter (Cannabis Tax Regulations, commencing
				with Regulation 3700), the definitions of terms in part 14.5, Cannabis Tax,
				(commencing with section
				34010) of division 2 of the
				Revenue and Taxation Code shall apply and the following terms are defined or
				further defined below.
(1) "California
				Cannabis Track-and-Trace system" means the system all persons licensed pursuant
				to division 10 (commencing with section
				26000) of the Business and
				Professions Code are required to use to record the inventory and movement of
				cannabis and cannabis products through the commercial cannabis supply
				chain.
(2) "Cannabis accessories"
				shall have the same meaning as set forth in section
				11018.2
				of the Health and Safety Code.
(3)
				"Cannabis flowers" means the flowers of the plant Cannabis sativa L. that have
				been harvested, dried, trimmed or untrimmed, and cured, and prior to any
				processing whereby the plant material is transformed into a concentrate,
				including, but not limited to, concentrated cannabis, or an edible or topical
				product containing cannabis or concentrated cannabis and other ingredients. The
				term "cannabis flowers" excludes leaves and stems removed from the cannabis
				flowers prior to the cannabis flowers being transferred or sold.
(4) "Cannabis leaves" means all parts of the
				plant Cannabis sativa L. other than cannabis flowers that are sold or
				consumed.
(5) "Cultivator" means
				all persons required to be licensed to cultivate cannabis pursuant to division
				10 (commencing with section
				26000) of the Business and
				Professions Code, including a microbusiness that cultivates cannabis as set
				forth in paragraph (3) of subdivision (a) of section
				26070
				of the Business and Professions Code.
(6) "Distributor" means a person required to
				be licensed as a distributor pursuant to division 10 (commencing with section
				26000) of the Business and
				Professions Code, including a microbusiness that acts as a licensed distributor
				as set forth in paragraph (3) of subdivision (a) of section
				26070
				of the Business and Professions Code.
(7) "Fresh cannabis plant" means the flowers,
				leaves, or a combination of adjoined flowers, leaves, stems, and stalk from the
				plant Cannabis sativa L. that is either cut off just above the roots, or
				otherwise removed from the plant.
To be considered "fresh cannabis plant," the flowers, leaves,
				  or combination of adjoined flowers, leaves, stems, and stalk must be weighed
				  within two hours of the plant being harvested and without any artificial drying
				  such as increasing the ambient temperature of the room or any other form of
				  drying, or curing and must be entered into the California Cannabis
				  Track-and-Trace system, manifested, and invoiced as "fresh cannabis plant." If
				  the California Cannabis Track-and-Trace system is not available, or a licensee
				  is not required to record activity, the paper manifest or invoice shall
				  indicate "fresh cannabis plant" is being sold or transferred.
(8) "Manufacturer" means a person required to
				be licensed as a manufacturer pursuant to division 10 (commencing with section
				26000) of the Business and
				Professions Code, including a microbusiness that acts as a licensed
				manufacturer as set forth in paragraph (3) of subdivision (a) of section
				26070
				of the Business and Professions Code.
(9) "Ounce" means 28.35 grams.
(10) "Plant waste" means waste of the plant
				Cannabis sativa L. that is managed pursuant to the cannabis waste management
				provisions of chapter 1, division 8 of title 3 of the California Code of
				Regulations.
(11) "Wholesale cost"
				means:
(A) Prior to January 1, 2020, the
				amount paid by the cannabis retailer for the cannabis or cannabis products,
				including transportation charges. Discounts and trade allowances must be added
				back when determining wholesale cost.
For purposes of this subdivision, "discounts or trade
				  allowances" are price reductions, or allowances of any kind, whether stated or
				  unstated, and include, without limitation, any price reduction applied to a
				  supplier's price list. The discounts may be for prompt payment, payment in
				  cash, bulk purchases, related-party transactions, or "preferred-customer"
				  status.
(B) On and after
				January 1, 2020, the amount paid by the cannabis retailer for the cannabis or
				cannabis products, including transportation charges.