California cops and tax officials raided a cannabis dispensary in Los Angeles last week, allegedly seizing nearly $175,000 in cash and even emptying out budtenders' tip jars.
Dispensary raids have become a fairly common sight in LA in recent years, thanks to coordinated federal and state efforts to crack down on black market sales. But in this case, cops raided the TLC Collective, a legal dispensary run by the Jungle Boys, a company that has been legally selling weed in California since 2006. And according to High Times, the dispensary was raided just because they failed to pay a late fee, and not because they committed an actual crime
“Right next to the office, two cops come with guns on us, put them in our face, tell us to get to the fucking ground, this is basically a raid, and we’re like what the fuck?” Iván Vanorwick of the Jungle Boys told High Times. “I was thinking in my head we owed them millions of dollars. I’ve never seen it where you have Highway Patrol undercovers, LAPD, sheriff, every agency there all working together.”
After some digging, Jungle Boys staff discovered that the California Department of Tax and Fee Administration (CDTFA) had launched the raid to recover a relatively small late fee. At the start of the pandemic, Jungle Boys temporarily closed their office and ended up not having enough cash on hand to pay their state taxes by the deadline. Tax officials hit the dispensary with a $66,000 late fee for failing to cough up the cash in time.
TLC paid off the $18 million that they owed the state last year, but chose to dispute the late fee. The company filed an official appeal against the fine, and officials reportedly accepted the request and scheduled a hearing to discuss the issue. But before the company had its chance to argue its case, CDTFA officials decided to take the money by force.
“This is our standard procedure for cannabis businesses or any business,” a spokesperson from the CDTFA told High Times. “We’re not singling out any industry or type of business. If you owe taxes in California, we do our best to collect what is due.”
To recover the $66,000 fine, cops allegedly seized $174,000 in cash from the store, and even stole employees' tip money. Vanorwick told the cops that he had filed an appeal and showed them the paperwork, but they reportedly refused to speak to his attorney or call off the raid.
The state's decision to extract their fee using the maximum possible force probably has a lot to do with the fact that some California cannabis businesses have recently been considering a tax revolt. Last December, several local businesses started drawing up a plan to withhold taxes to protest the state's excessive tax regime.
California currently has some of the highest adult-use tax rates in the entire country, and these high taxes are making it hard for legal businesses to compete with the black market. On top of this fierce competition, weed businesses are struggling to recover from a wave of organized robberies, wildfires, and droughts. State politicians have promised to consider reforming the state's tax regime, but in the meantime, local counties and cities have had to step up and reduce their own local taxes in order to help the industry survive.