Virginia Cannabis Legalization on the Governor’s Desk Again
We have been here before. Over the last several years the Virginia legislature has passed legislation to create a framework for its adult-use program which was first approved of all the way back in 2021. However, this progress was routinely blocked by really by two former Governors (Ralph Northam and Glenn Youngkin).
This is about to change.
Last week, the Virginia legislature not only concluded its regular session but also passed HB642 and SB542 to create a cannabis adult-use framework. This sets up a general licensing structure, details on license types, and a bit on what we can expect for the next year. And at last, Virginia has a Governor in Abigail Spanberger who, unlike her predecessor, has a strong track-record in supporting cannabis. Virginia’s adult-use market is finally going to launch. And here is what you need to know.
General Overview
Final regulations from the Virginia Cannabis Control Authority are set for at no later than September 1, 2026 with the launch of retail sales on January 1, 2027. We had previously seen that microbusiness licenses had to begin being issued on or before July 1, but that language has been struck from the final bills.
This doesn’t mean that we won’t see license types issued on or around July 1, just that this is no longer mandated by statute. With a statutory requirement of retail sales for the start of next year, the CCA will have to move quickly in issuing licenses. There has been a lot of waiting in Virginia since 2021, but things are going to be moving quickly from here until January and this is a fairly aggressive timeline for launch.
We also now know what taxes are going to look like. There will be a 6% state excise tax along with a 5.3% retail tax. Local governments can tax anywhere from 1-3.5% additionally through local taxes, so we will see variations on product prices across Virginia depending on which municipality the business is operating in.
There will also be licenses for the following: cultivation, microbusiness, delivery, testing, processing, transporter, and retail.
Expect More Updates Soon
A lot of the most pressing details for the launch of this adult-use market have been punted to the CCA. Luckily, we have an April 8th meeting of the CCA Board of Directors which will likely offer further information. This can include how and when licenses will be issued and what requirements are going to be necessary.
Now is the ideal time to get started on working and ironing out your details, because things are going to be moving fast. Now is the time to start identifying compliantly zoned properties, lining up vendors, assessing finances, and business planning.
Luckily at Canna Advisors, this isn’t our first rodeo and we are ready to guide you through all your Virginia related cannabis needs.