CA AB564

Reduces California's cannabis excise tax rate from 19% to 15% of gross retail receipts for the period from October 1, 2025, through June 30, 2028

Maintains the 19% excise tax rate only for July 1, 2025, through September 30, 2025, before the reduction takes effect

Requires the California Department of Tax and Fee Administration to adjust the excise tax rate starting in fiscal year 2028-29 and every two years thereafter, capped at a maximum of 19%, based on revenue equivalent to the discontinued cultivation tax

Mandates the Department of Cannabis Control to submit a report to the Legislature by October 1, 2027, analyzing the tax law's impact on the regulated cannabis market versus the illicit market and recommending tax policy changes

Takes effect immediately as a tax levy upon approval by the Governor on September 22, 2025