According to a report from MinnPost, the Minnesota Department of Revenue has announced that the state has generated $10,022,635 in tax revenue from hemp-derived THC products since their market launch nearly a year ago.
Although Minnesota legalized cannabis use for adults last year, the full adult-use industry is not expected to be operational until 2025. In the interim, lawmakers legalized low-dose cannabis edibles and other products, leading to significant growth in the market for hemp-derived cannabinoid products.
In May alone, the state collected $1,217,450 in taxes from 1,873 tax-paying businesses. With monthly tax revenues now consistently surpassing $1 million, officials estimate the annual market size for hemp products to be approximately $130 million, taxed at a 10% rate on sales.
Industry leaders have expressed some skepticism regarding the reported figures. Shawn Weber, president of the Minnesota Cannabis Growers Cooperative and co-owner of Crested River Cannabis, noted, “While $130 million annually is a strong start, I believe the actual market size could be higher based on industry insights.”
Under Minnesota’s regulations for low-potency hemp products, companies selling these items were required to register with the Department of Health’s Office of Medical Cannabis, which recently merged with the Office of Cannabis Management.
Twenty percent of the state’s hemp-derived tax revenue is allocated to local governments, with counties receiving half and city governments the other half. Counties with a greater number of licensed cannabis businesses will receive a larger share of tax distributions.
