The Tennessee hemp industry, a cornerstone of economic growth and innovation, is under assault from several flawed bills: HB 1376/SB 1413 (the ABC Bill), HB 1148/SB 1236 (the THCA & THCP Ban Bill), and SB 763 (Vape Bill). These proposals aim to dismantle a thriving market, burden small businesses, and cut jobs in a state that claims to be “business-friendly.” A more rational path is essential.
The ABC Bill would shift oversight of hemp-derived products from the Department of Agriculture to the Alcoholic Beverage Commission and Department of Revenue, enforcing impractical rules. It lowers the THCA threshold from 0.3 percent to 0.1 percent, contradicting the Federal Farm Bill, bans THCA products, prohibits online sales, and excludes hemp from convenience and grocery stores. It also demands a $750,000 retainer per license, which is a devastating cost for small businesses.
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Set to take effect January 1, 2026, the bill offers little time for transition. While a proposed amendment might allow THCA to remain, the new framework, exorbitant fees, and added taxes would still cripple businesses. Historical trends show such measures drive consumers to unregulated markets, risking consumer safety and legitimate commerce.
Meanwhile, SB763 introduces a 1-cent-per-milligram THC content wholesale tax. For a 1g vape cartridge with 800 mg of Delta 8-THC, that’s $8 in tax. If the original retail price is $100, the new price becomes $108 after the tax. In Chattanooga, with a 7 percent state sales tax ($7.56), 6 percent HDC sales tax ($6.48), and 2.25 percent local tax ($2.43), sales taxes total $16.47. Combined with the $8 wholesale tax, the consumer faces $24.47 in taxes, a 24.47 percent effective rate.
The THCA & THCP Ban Bill labels both compounds—federally legal under the 2018 Farm Bill—as Class A misdemeanors. THCA is naturally occurring and drives Tennessee’s hemp markets, while THCP significantly differs. While the industry might accept excluding THCP, a full ban would devastate farmers, retailers, and manufacturers, causing closures and job losses.
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Despite this turmoil, we’re launching a hemp-centric brand in Tennessee that is centered on music and art and celebrates hemp’s cultural role. Hemp drives sustainability in wellness, textiles, and economic growth, and we aim to create jobs, generate revenue, and enrich the local cultural scene.
These bills unfairly favor highly processed D9-THC products while banning natural THCA, with inconsistent enforcement logic. Financially, they’d cut approximately $5.2 million in monthly tax revenue, as THCA smokables make up roughly 69 percent of sales in the state. The Department of Agriculture’s rules, just 90 days old as of December 2024, need time to work.
Legislators must reject these bills and uphold sensible regulations, like age limits and clear labels, to protect consumers without killing entrepreneurship. Hemp is a resource, not a target for outdated prohibition mindsets and the failed drug war. A truly business-friendly Tennessee fosters growth. Lawmakers’ choice will reveal their commitment to our future.
*This article was submitted by a guest contributor. The author is solely responsible for the content.