Mississippi Cannabis Legalization

On November 3, 2020, voters approved Mississippi medical cannabis legalization through a ballot initiative in Mississippi. Legislation became law on February 2, 2022, when Governor Tate Reeves signed Senate Bill 2095, the Mississippi Medical Cannabis Act, that regulates the production and distribution of cannabis flowers and concentrates to qualified patients. The new law designates the Mississippi Department of Health (MDOH) as the lead agency, to have “ultimate authority for oversight of the administration” of the program and is charged to coordinate its activities with the Mississippi Department of Revenue (MDOR).

How to Start a Cannabis Business in Mississippi

The Act permits qualified patients to purchase up to 3.5 grams of cannabis flower or up to one gram of cannabis concentrate per day from licensed dispensaries, and tax cannabis retail sales at the current state sales tax rate of 7%. It also sets an excise tax on medical cannabis cultivation facilities at a rate of 5% of the sale price of cannabis trim or cannabis flower.

Annual licensing fees vary by type of facility and size:

• Micro-cultivators – (growers with cannabis canopies under 2,000 sq. ft) annual licensing fees range from $2,000 to $3,500.
• Cultivators – annual licensing fees for cultivators range from $15,000 for Tier 1 (with a cannabis grow canopy of up to 5,000 sq. ft) to $150,000 for Tier 6 (100,000 sq. ft or more).
• Micro-processors (less than 3,000 lbs. of biomass annually) – from $3,500 to $5,000.
• Processors (over 3,000 lbs. of biomass annually) – $20,000.
• Dispensaries – $25,000.
• Transportation companies – $7,500.
• Disposal companies – $7,500.
• Testing facilities – $15,000.
• Research facilities – $15,000.

Potency caps:

• Flower cannot exceed 30% THC.
• Tinctures, oils, and concentrates may not exceed 60%.

In 2023, House Bill 1158 allowed people 21 and older to purchase topical products regardless of a medical card. Mississippi is the first state in the country to implement a hybrid model for the sale of topical medical cannabis products.

Mississippi Cannabis Market: Stats and Projections

In June 2022, MDOH began accepting applications for patient identification cards, registration of practitioners who desire to participate, as well as licensing of cultivation facilities, processing facilities, testing facilities, research facilities, disposal companies, and transportation companies. The Mississippi Department of Revenue is responsible for the licensing of medical cannabis dispensaries beginning in July.

Medical cannabis has been available to patients in Mississippi since January 25, 2023. While the number of medical cannabis patients was only 2,000 at the start of 2023, at the end of the year the Mississippi Department of Health reported more than 32,000 patients had been enrolled. In the first eleven months, retailers sold about $44.4 million worth of products.

As of March 2024, two departments had issued 392 licenses to 193 dispensaries, 133 cultivators, 30 processors, 25 transportation entities, 7 state-mandated “disposal companies” and 4 testing laboratories.

Mississippi Cannabis Market Infographics