Costa Mesa’s Illegal Cannabis Dispensaries Could be Committing Tax Fraud: Mayor

As Costa Mesa prepared to move forward with its retail cannabis plans Feb. 23, its mayor called out illegal dispensaries operating within the city.

Speaking during a special study session, Mayor Katrina Foley said under-the-table marijuana dispensaries could be committing tax fraud.

“They [customers] are paying sales tax; it’s not getting collected and sent to the government agencies,” Foley said. “It’s just getting pocketed. In most instances they’re not paying their employees properly, they don’t have workers comp, or unemployment. Those employees are not cared for as well.”

Her comments came during a discussion of Costa Mesa’s Measure Q, a retail cannabis tax and regulation measure that passed last November with 65 percent support. It allows for recreational cannabis dispensaries and deliveries to operate within the guidelines adopted by city council.

However, the city has not yet processed any legitimate dispensaries.

“I think we all agree that we want to shut down the wrongful actors as quickly as possible, and not let it drag out for a long time and impact the adjacent businesses, or the residents, or also just the customers who don’t know that it’s an illegal operation,” Foley said.

Although the Measure Q ballot measure passed, Costa Mesa is still working on an ordinance to implement the initiative.

It means that retail cannabis dispensaries are still illegal within the city, Costa Mesa spokesperson Tony Dodera told The Epoch…

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As Costa Mesa prepared to move forward with its retail cannabis plans Feb. 23, its mayor called out illegal dispensaries operating within the city.

Speaking during a special study session, Mayor Katrina Foley said under-the-table marijuana dispensaries could be committing tax fraud.

“They [customers] are paying sales tax; it’s not getting collected and sent to the government agencies,” Foley said. “It’s just getting pocketed. In most instances they’re not paying their employees properly, they don’t have workers comp, or unemployment. Those employees are not cared for as well.”

Her comments came during a discussion of Costa Mesa’s Measure Q, a retail cannabis tax and regulation measure that passed last November with 65 percent support. It allows for recreational cannabis dispensaries and deliveries to operate within the guidelines adopted by city council.

However, the city has not yet processed any legitimate dispensaries.

“I think we all agree that we want to shut down the wrongful actors as quickly as possible, and not let it drag out for a long time and impact the adjacent businesses, or the residents, or also just the customers who don’t know that it’s an illegal operation,” Foley said.

Although the Measure Q ballot measure passed, Costa Mesa is still working on an ordinance to implement the initiative.

It means that retail cannabis dispensaries are still illegal within the city, Costa Mesa spokesperson Tony Dodera told The Epoch…

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