First Retail Cannabis Sales to Begin in Ohio With 10% Excise Tax

Ninety-eight cannabis dispensaries in Ohio can begin selling recreational marijuana as soon as Tuesday as a ballot measure approved by voters last year takes effect.

Recreational cannabis customers will pay a 10% excise tax on top of the state’s 5.75% sales tax, which is also levied on medical marijuana. Without the dual-use certificates of operation announced Monday by the state Division of Cannabis Control, Ohio dispensaries were not permitted to cultivate, process, test, or sell non-medical cannabis.

More dispensaries are expected to receive operating certificates later in the week after the initial batch of 98, the division said. Officials will continue to review dispensaries’ applications for recreational operation certificates, it added.

Ohio voters approved the ballot measure legalizing recreational marijuana sales and the 10% excise tax in November 2023 with 57% of the votes. Following the vote, the state Senate pushed to make changes to the legalization measure, including raising the new levy to 15%, but the legislation stalled in the state House.

Ohio, which is not one of the 22 states that allows tax deductions for cannabis companies, could see $276 million to $403 million in annual tax revenues from cannabis sales after five years of operation, according to estimates by Ohio State University.