Taxes
Topic
Cannabis and hemp taxes
Coverage of cannabis excise taxes, hemp-derived THC taxes, local add-ons, federal tax treatment under Section 280E and the filing and remittance rules that trip up operators. For finance teams, accountants and anyone modeling a cannabis business.
About our tax coverage
Cannabis is one of the most heavily taxed consumer products in the United States. States apply excise taxes by price, weight or potency, cities add local taxes, and federal law denies ordinary business deductions to businesses trafficking in controlled substances. Hemp-derived THC products are increasingly taxed as well, with several states adopting dedicated excise rates.
We track tax rate changes, new hemp THC taxes, Section 280E developments and rescheduling implications, remittance deadlines, audit activity and tax relief proposals. Each post links to the statute, agency bulletin or legislative text.
Tax policy also drives market structure. High excise rates push consumers toward illicit or hemp alternatives, and lawmakers regularly adjust rates in response. We follow those debates and link to fiscal analyses and bill text where they are available.
What you will find
- State cannabis excise tax structures and rate changes
- New excise taxes on hemp-derived THC products
- Section 280E, deductions and federal rescheduling effects
- Local cannabis taxes and revenue allocation
- Filing, remittance and audit rules for licensees
Frequently asked questions
How are cannabis products taxed?
Most states charge an excise tax on cannabis sales, calculated by retail price, weight or THC content, plus regular sales tax. Many cities and counties add local taxes. Rates and structures differ by state.
What is Section 280E?
A federal tax code provision that denies business deductions to companies trafficking in Schedule I or II controlled substances. It applies to state-legal cannabis businesses and raises their effective tax rate well above other industries.
Are hemp-derived THC products taxed like cannabis?
In a growing number of states, yes. Several have adopted excise taxes on intoxicating hemp products, while others apply only regular sales tax.
Is this legal or tax advice?
No. Our coverage is general information drawn from public sources, not legal or tax advice. Work with a licensed tax professional on your filings. Report errors through the contact page.
The Regulator Brief
Every hemp and THC rule change, every Monday
One email a week covering new laws, agency rules and court rulings across US states and the countries we track.









































