Cannabis retailers may apply to retain excise tax as vendor compensation

Beginning January 1, 2023, through December 31, 2025, cannabis retailers that have been approved by the Department of Cannabis Control for an equity fee waiver can apply with the CDTFA for vendor compensation.1 Under the vendor compensation program, eligible cannabis retailers may retain 20% of the cannabis excise tax due on their retail sales of cannabis or cannabis products.2

The CDTFA will e-mail a cannabis retailer when their Vendor Compensation Application is approved or denied. The approval notification will include the 12- month period for which the cannabis retailer may retain vendor compensation. The retention period begins on the first day of the calendar quarter after the date we issue the notice approving vendor compensation.

1 AB 195 (Ch. 22-56)
2 CDTFA Special Notice L-884 (December 2022), available at: