Tennessee Ban on THCA Has Cost State $54M in Tax Revenue  

The Tennessee ban on THCA products has cost the state $54 million in tax revenues, WPLN News reports. Last year, state lawmakers approved the ban along with a new tax on intoxicating hemp products but has only collected 3% of what the new tax was projected to bring in. 

In February, the state had anticipated collecting about $8.8 million from the new tax but has only brought in $61,000. The THCA effectively ended the sale of smokable hemp and full-spectrum CBD products, which were the most profitable in the market. The lower sales have also impacted the sales tax the state had previously collected on hemp products. 

The ban was initially supposed to take effect January 1 but was delayed until the summer so cultivators and retailers could shift their business models. 

Lee Crabtree, a hemp farmer, told WPLN that he is “not making the money” he did “back when CBD was huge there for a minute.”  

The state has patched the $54 million deficit with surpluses from other taxes, including franchise and excise taxes, and sales tax more broadly.