Hemp-Derived Cannabinoid Products Tax

Beginning January 1, 2026, hemp-derived cannabinoid products are subject to a new wholesale tax and brand registration requirement.

A hemp-derived cannabinoid product is a product that contains or is labeled as containing a hemp-derived cannabinoid and that is produced, marketed, or otherwise intended to be ingested orally, inhaled, or absorbed through the skin, including hemp and hemp plant parts, and any product that may contain a hemp-derived cannabinoid that is extracted from hemp plants or hemp plant parts.

Overview

Brand Registration

Suppliers must annually register each brand of hemp-derived cannabinoid products they sell in Tennessee and pay a brand registration fee.

Suppliers licensed by the Alcoholic Beverage Commission, under Title 57, Chapter 7 must register a hemp-derived cannabinoid product brand with the Department before delivering the brand to a wholesaler for distribution in Tennessee

Hemp-Derived Cannabinoid Wholesale Tax

Tennessee also imposes a wholesale tax on each hemp-derived cannabinoid product sold at wholesale in the state. Wholesalers are responsible for paying this tax.

Only taxpayers subject to licensure by the Alcoholic Beverage Commission, under Title 57, Chapter 7, are subject to this tax. Taxpayers with valid licenses issued by the Department of Agriculture are not subject to the new wholesale tax. However, when the license issued by the Department of Agriculture expires, such taxpayers must obtain a license from the Commission and will be subject to the wholesale tax.