La Mesa Raises Cannabis Tax to 5%
La Mesa City Council unanimously voted to increase its cannabis business tax rate from 4% to 5%, effective January 1.
Updated on Nov. 5, 2026 in Local Shops
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The La Mesa City Council voted unanimously on October 27 to raise the cannabis business tax rate from 4% to 5%. The city hit its limit on dispensaries, and the increase is estimated to generate $600,000 in additional annual revenue.
Why it matters
The increase aims to boost city revenue at a time when La Mesa has reached its capacity for cannabis retailers. The city's 14 legally operating cannabis retailers will face the higher rate starting in 2027.
La Mesa's cannabis business tax rises from 4% to 5%, below San Diego's 10% rate. The city has 14 legally operating retailers and expects about $600,000 in added yearly revenue, though how that money will be spent was not specified.
The players
La Mesa City Council
The La Mesa City Council is the governing body of the city of La Mesa in San Diego County, responsible for local tax and zoning decisions.
Lauren Cazares
Lauren Cazares is a La Mesa city councilmember who proposed raising the cannabis business tax rate.
The details
Councilmember Lauren Cazares proposed the increase, and the council approved it unanimously. Current zoning requires cannabis retailers to stay 1,000 feet from other retailers, churches, and schools, and La Mesa has the highest concentration of licensed dispensaries in the East County region.
Timeline
October 27, 2026: City Council unanimously votes to raise the cannabis tax rate.
January 1, 2027: The 5% cannabis business tax rate takes effect.
Local Shops Context
Voters approved a city tax on commercial cannabis in 2018, and La Mesa's new 5% rate builds on that framework as the city's dispensary count reaches its cap. Neighboring Santee caps its own retailers at four, while El Cajon prohibits dispensaries entirely.
Cannabis buyers in La Mesa may see the 1% tax increase passed on to them through shelf prices, since retailers will pay the higher 5% rate starting January 1, 2027. The city's dispensary limit also means new retail options are unlikely to open near existing shops.
The takeaway
Shoppers who buy cannabis in La Mesa should watch for possible price changes after the new tax takes effect in January 2027. Local business owners should review how the 1,000-foot zoning rule affects any plans to open a retail location.
Further reading
Explore more local shop news in La Mesa to follow how regulations affect neighborhood retailers.
Source note: This article includes information reported by San Diego Union-Tribune.
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