Appellation Regulations & Compliance Resources: Cultivation Tax Invoicing and Distribution Transport

Updated: Oct 1


The Appellations Comment Deadline Is Approaching (unless is isn’t)


The 45-day comment period deadline for appellation regulations is quickly approaching, with written comments currently due on April 6. Due to the COVID-19 crisis, we think there’s a strong chance that the appellation regulations will be postponed or extended. But until we know more, we’re moving forward as if the current deadline will remain in place.


As a reminder, comments can be submitted to CDFA until Monday, April 6, 2020 by emailing CalCannabis_Appellations@cdfa.ca.gov.


Check out the following HCGA resources for a summary of the appellation regulations, and some of the major topics and concerns that have been flagged on Industry Affairs Calls.


HCGA Summary of Appellation Regulations

List of Appellation Topics Discussed on Industry Affairs Calls


HCGA has been working with cannabis appellations experts and legacy cultivation regions at Origins Council to develop coalition comments on appellation regulations, mirroring the appellation discussions on the IAC calls over the past several weeks. Assuming the comment period is not extended, HCGA will have full draft comments available for review later this week before final comments are submitted. Check the #appellations channel on Slack throughout the week for continued updates.


HCGA Compliance Resources: Cultivation Tax Invoicing and Distribution Transport-Only


In response to feedback on common compliance issues facing HCGA members, HCGA staff has put together two new FAQs on two key topics: distribution transport-only licenses, and invoicing requirements for the cultivation tax.


  • Distribution transport-only license FAQ - distribution transport-only licenses are a great way to increase flexibility for cultivators, manufacturers, processors, and nurseries that want to be able to transport product without relying on a third-party distributor or applying for a full distribution licenses. Compared to other license types, the barriers to entry for a transport-only license are relatively low. This FAQ covers how to apply for a distribution-transport license and some of the key regulations for the license type.


  • Cultivation tax invoicing FAQ - Correctly documenting cultivation tax payment is especially important, even compared to other record-keeping requirements, because it can determine who the state holds liable for cultivation tax in the event of any confusion or audit.


Unfortunately, the cultivation tax record-keeping requirements aren’t streamlined between agencies: CDTFA and each of the three cannabis regulatory agencies (CDFA, BCC, and DPH) all have slightly different requirements for what should be included on invoices or receipts.


This document summarizes the state rules, among each of the agencies, for transferring, calculating, and documenting cultivation taxes for cultivators, manufacturers, and distributors.


Both documents are open for comment, and we encourage members to use these documents to ask questions and share experiences.


If you have requests for other compliance resources/FAQs, feel free to email ross@hcga.co or post on Slack.


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