- Pexels / Miguel Arcanjo Saddi
In the suit, filed Wednesday in Travis County District Court, the companies warn that the state is shutting down a valuable source of sales tax revenue and putting roadblocks in front of a growing industry.
Texas legalized hemp in 2019 and this week issued new rules licensing businesses to manufacture and sell hemp products such as oils and edibles. As part of those new guidelines, however, the state enacted a ban on smokable hemp products.
"If allowed to move forward, these bans on smokable hemp products will shutter businesses across the state, resulting in a loss of jobs and tax revenue," the suit alleges. "They impede the economic liberty of Texas businesses, pose an existential threat to Texas hemp manufacturers, farmers, and retailers, and are sure to stifle growth of a budding Texas industry. The hemp market is now in its growth stage — perhaps the most critical stage of an industry’s lifecycle."
The lead plaintiff, Crown Distributing LLC, told news site Marijuana Moment that it stands to lose $59.6 million in sales over the next five years and the state would lose $2.9 million in annual tax revenue.
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