A legislative committee in Nebraska has advanced a sweeping tax bill that would, among other changes, impose a 30 percent sales tax on “consumable hemp” and CBD products. The proposal, broadly aimed at providing property tax relief, will now be considered by the full legislature.
On Monday, lawmakers on the Revenue Committee passed the bill, LB 34, on a 6–1 vote. The tax package combines various proposals that have been introduced during the state’s special legislative session, called by Gov. Jim Pillen (R) last month to deal with the property tax issue.
As approved by the committee, the bill would set a 30 percent sales tax on “consumable hemp products,” defined as finished products that contain hemp and that contain no more than 0.3 percent THC. Hemp products made from stalks or seed—that is, for fiber or food use—would not be included in the definition, nor would pharmaceuticals approved by the federal Food and Drug Administration (FDA).
Revenue Committee chair Sen. Lou Ann Linehan (R), who has played a central role in the tax discussion, first introduced the 30 percent hemp tax two weeks ago, in an earlier bill she sponsored. A separate proposal she introduced during the regular legislative session would have taxed consumable hemp and CBD at 100 percent, a rate that was later reduced to 25 percent before the underlying bill fizzled out.
“The 100% tax was unworkable for CBD companies in our state. They were concerned it would drive them out of business,” Sen. Anna Wishart (D), who’s backed past efforts to end marijuana prohibition in the state, told Marijuana Moment in an email at the time. “In talking with representatives from a group of CBD companies in the state, I worked with them and other senators to negotiate the tax down to 25%.”
The rate is now at 30 percent in the bill moving to the floor.