Why illegal cannabis dispensaries call transactions ‘donations’
Have you ever wondered why unlicensed cannabis dispensaries call transactions ‘donations?’ Or why your purchase may come with a ‘gift?’
Well, there’s actually a pretty simple explanation.
By the dispenser calling it a donation, or saying they’re gifting cannabis, they’re able to circumvent the law.
Unlicensed dispensaries do this because they believe they’re not technically ‘selling’ you cannabis.
By calling the exchange a ‘donation,’ they’re attempting to frame it as a charitable act, rather than a commercial transaction.
Simply put, these sellers use the term ‘donation’ as a way to avoid legal consequences for their actions.
Dispensaries Operating Without a License
It’s no secret that a gray area still exists in the cannabis industry.
While operating a dispensary without a license is illegal, it is not unheard of.
People operate a dispensary without a license for a variety of reasons. A few are because of a lack of access to legal options, financial gain, or even a desire to provide medical cannabis to those in need.
However financially rewarding operating a dispensary without a license is, it is still risky business. Doing so can put the safety of both the merchant and customer in jeopardy.
From theft to toxic products or even legal consequences, such as fines, imprisonment, or the seizure of assets– are all very real possibilities.
Unlicensed dispensaries are especially known to not have the same quality control standards or safety regulations as licensed dispensaries do. That puts the health and well-being of their customers at risk.
These reasons are why it is always recommended to shop at a licensed dispensary. You’ll know you’re in one when you see certificates of compliance upon entering the store.
The Term ‘Donation’
Donations have long been considered a safe way of giving money to trusted organizations, and even individuals in need.
However, over the years, donations have been caught being used for fraud, or other illegal activity.
In areas where the black market thrives, such as New York City and Los Angeles, donating cannabis has become increasingly common.
The idea behind ‘donating’ or ‘gifting cannabis’ is often associated with a culture of sharing within the cannabis community. Many consumers share their home-grown or legally purchased cannabis with friends or acquaintances.
As law-makers in states across the country relax restrictions and roll out regulations, some legacy market operators continue to sell without a license.
Without the legal implications associated with a sale, those operating an unlicensed dispensary can avoid paying taxes.
Avoiding taxes enables them to sell their product cheaper than the regulated stores. This in turn attracts customers, sometimes even those underage.
Unlicensed dispensaries in general are aware that even though they consider it to be a donation, the law still applies.
Cannabis must be sold and purchased from a legal, regulated store.
It is important to note that the legality of gifting cannabis varies by state. Even where it is legal, there are limits on the amount that can be given.
The Purchase and Donation
Consumers shopping for cannabis from an unlicensed dispensary will typically buy an item such as a T-shirt that costs equivalent to the amount of weed they want.
A $20 shirt suddenly becomes valued at $200, but it’ll also come with an ounce of cannabis as a gifted ‘donation.’
However seemingly equitable these transactions appear, there is no guarantee of product safety or efficacy.
The Tax Issue
Shopping at unlicensed dispensaries can seem like an attractive offer when the prices are lower than licensed, tax-paying dispensaries.
Instead of registering purchases through a sales system, these unlicensed disparities are engaging in tax fraud.
Gifting cannabis is not a tax accepted form of transaction, and participating in such exchanges is not only questionable, but could potentially carry harsh penalties.
One illegal dispensary in New York City was recently fined $50,000, and had one worker arrested, for operating without a license.
While illegal dispensaries might initially present an appealing bargain, their lack of compliance in multiple areas could risk both personal and financial repercussions in the future.
While many dispensaries have implemented a donation model for their products, what they’re effectively doing is exploiting their customers with what appears to be an innocent giving system.
These seemingly equitable transactions often involve overpriced products and no guarantee of product safety or efficacy.
As a result, both recreational and medical cannabis consumers need to be aware that these donation models may take advantage of them if not utilized wisely.
All in all, calling a transaction a ‘donation’ helps create the illusion of legitimacy for these unlicensed dispensaries. By framing their business as a non-profit or donation-based organization, some dispensaries think they’ll be able to attract customers who believe they are supporting a good cause.
What’s important to note is that by calling a transaction a “donation” does not make it legal, and illegal dispensaries can still face legal consequences for selling cannabis, regardless of the terminology they use.
If you live in a state where cannabis is legal, always shop at a compliant state-regulated dispensary.
In States like California theprices re’s no money in legal dispensaries to many people operating without a licence you can’t compete with black market weed, I pay $80 ounce for top shelf weed from California plus $20 express delivery . you won’t find a deal like that at a dispensary and I’m getting it from a licensed farmer that supplies dispensaries ☝🇺🇸
Legalization does nothing to help the consumer but jack up the price. By painting California’s medical marijuana model of donations as being less than acceptable or moral, you fail to account for how the ultra rich stay ultra rich or got that way in the first place (besides stealing from the common working folks by paying them pennies on the dollar to produce the goods sold or services provided). Those who write the laws circumvent them…that’s the way it is in capitalism. That’s why decriminalization is not legalization. We don’t need all those laws around cannabis. It’s a plant. All we needed was to decriminalize it. The consumer (patient) got way more bang for their buck under the medical marijuana model. Now I know you might say that unlicensed dispensaries don’t test, but testing is a scam. No industry is beleaguered with the onerous testing of the cannabis industry. All we have to do is look at the medical cartel that told people DDT was good to kill mosquitos that were causing disease, when it was the DDT itself that caused the health issues…then blamed it on a virus and got rich with a vaccine. Lately pushing shoddily tested vaccines on people (giving them for free to the people on the government’s dime, government/corporate collusion is the definition of fascism. That scam siphoned trillions into the coffers of Big Pharma since 2020 and people are dying every day as a result. It was the largest transfer of wealth ever in the USA. But you want to sully the morality of medical marijuana model of donations for herb? Ya’ll killed California’s cottage industry that saw rural towns thrive.. As for the crime cartels, look no further than the government organizations that allow them to thrive and actually do business with them. Of course they will get their fingers in the pie. They are vertically integrated. Remember, the “mobs” are corporately legal now and any legal cannabis companies are leveraged to their eyeballs now…. to some corporate or private equity firm that sees only profits in the plant we love.
Legalization does nothing for consumers other than drive up prices. By portraying California’s medical marijuana donation model as less than acceptable or ethical.