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Cannabis Business Tax Amnesty Program / Outstanding Tax Liabilities / Installment Agreements

Council File 25-0600-S125

Under review — the city council approved the Cannabis Business Tax Amnesty Program in March, but implementation directives from June committee reports still need final council action, including an authorizing ordinance and $300,000 in staffing funds.

Introduced
2025-10-14
Last changed
2026-06-16
Status
open
Expires
2028-06-12
Committee
Budget and Finance Committee
Initiated by
Office of Finance

Brief

The Office of Finance proposed a Cannabis Business Tax Amnesty Program allowing cannabis retailers and operators to resolve outstanding tax liabilities through installment agreements with penalty reductions. The program aims to bring compliant businesses current while increasing city revenue. After approval by both Government Operations and Budget and Finance committees (both as amended), City Council adopted the measure 14-0-1 on March 3, 2026. The file is now final.

Full summary

The Cannabis Business Tax Amnesty Program, initiated by the Office of Finance in October 2025, creates a structured pathway for registered cannabis businesses with unpaid Los Angeles tax obligations to resolve their debts and restore compliance. Under the program, eligible businesses can either pay their outstanding liability in full or enter into an installment agreement of up to 36 months. In exchange, the Office of Finance will waive 100 percent of penalties and accrued interest. Small businesses facing comparatively large liabilities may qualify for extended agreements of up to five years. Businesses that successfully resolve their liability through either route are considered in good standing with the city for tax purposes. Participating businesses must meet several ongoing conditions: they must report gross receipts data for any periods with missing filings, agree to cooperate with audits of previously unaudited tax reporting, and commit to continued compliance with regular tax filing and payment requirements going forward. Missing a monthly installment payment or failing to file a monthly tax return is grounds for termination of the amnesty agreement, at which point the waived penalties and interest would be reinstated. The file traveled through two rounds of committee review. An initial version cleared Government Operations and Budget and Finance committees in early 2026 and was adopted by full Council 14-0-1 on March 3, 2026, with Councilmembers Yaroslavsky and McOsker presenting the motion. The Office of Finance then submitted more detailed implementation reports in May 2026. Government Operations Committee approved the updated framework as amended on June 2, 2026, and Budget and Finance Committee concurred on June 16, 2026. The June 2026 joint committee report adds three further directives pending final Council action: the Office of Finance is instructed to implement the program and report back within 45 days of the application deadline with data on participation rates, total liability waived, and anticipated new revenue; the City Attorney is asked to prepare an authorizing ordinance; and $300,000 in staffing appropriations are directed to the Office of Finance to be funded from increased cannabis tax revenues. The committees also directed the Office of Finance to develop a plan for a gross receipts tax exemption for social equity cannabis businesses, with an exemption threshold to be set somewhere between $100,000 and $1,000,000.

Activity (22)

  • 2026-06-16 Budget and Finance Committee concurred with the Government Operations Committee's action of June 2, 2026.
  • 2026-06-12 Budget and Finance Committee scheduled item for committee meeting on June 16, 2026.
  • 2026-06-02 Government Operations Committee transmitted Council File to Budget and Finance Committee.
  • 2026-06-02 Government Operations Committee approved as amended .
  • 2026-05-29 Government Operations Committee scheduled item for committee meeting on June 2, 2026.
  • 2026-05-26 Office of Finance document(s) referred to Budget and Finance Committee; Government Operations Committee.
  • 2026-05-26 Document submitted by Office of Finance, dated May 26, 2026.
  • 2026-05-22 Office of Finance document(s) referred to Budget and Finance Committee; Government Operations Committee.
  • 2026-05-21 Document submitted by Office of Finance, dated May 21, 2026.
  • 2026-03-04 Council action final.
  • 2026-03-03 Council adopted item, subject to reconsideration, pursuant to Council Rule 51.
  • 2026-02-27 City Clerk scheduled item for Council on March 3, 2026.
  • 2026-02-17 Budget and Finance Committee approved as amended .
  • 2026-02-13 Budget and Finance Committee scheduled item for committee meeting on February 17, 2026.
  • 2026-02-03 Government Operations Committee transmitted Council File to Budget and Finance Committee.
  • 2026-02-03 Government Operations Committee approved as amended .
  • 2026-01-29 Government Operations Committee scheduled item for committee meeting on February 3, 2026.
  • 2026-01-20 Government Operations Committee meeting cancelled.
  • 2026-01-15 Government Operations Committee scheduled item for committee meeting on January 20, 2026.
  • 2025-10-28 Corrected Referral per City Clerk to include Budget and Finance Committee.
  • 2025-10-15 Office of Finance document(s) referred to Government Operations Committee.
  • 2025-10-14 Document submitted by Office of Finance, dated October 2, 2025.

Documents (21)

Council votes (1)

  • 2026-03-03 Vote — 14-0-1 · Regular

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