HOUSE BILL NO. 1328 103RD GENERAL ASSEMBLY
INTRODUCED BY REPRESENTATIVE ALLEN.
2106H.01I JOSEPH ENGLER, Chief Clerk
AN ACT To amend chapters 144 and 407, RSMo, by adding thereto seventeen new sections relating to hemp products, with penalty provisions.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Chapters 144 and 407, RSMo, are amended by adding thereto seventeen 2 new sections, to be known as sections 144.028, 407.3070, 407.3073, 407.3076, 407.3079, 3 407.3082, 407.3085, 407.3088, 407.3091, 407.3094, 407.3097, 407.3100, 407.3103, 4 407.3106, 407.3109, 407.3112, and 407.3115, to read as follows: 144.028. 1. As used in this section, the term "intoxicating hemp product" shall 2 have the same meaning given to the term in section 407.3070. 3 2. For all tax years beginning on or after January 1, 2026, an excise tax is hereby 4 levied and imposed upon the retail sale of intoxicating hemp products to consumers 5 within this state. The rate of tax shall be two and one-fourth percent of the retail 6 purchase price paid or charged. 7 3. The portion of the revenue derived from the tax levied under this section that 8 represents revenue from a tax rate of one-fourth of one percent shall be deposited by the 9 department of revenue into the hemp business fund established under section 407.3076. 10 4. The portion of the revenue derived from the tax levied under this section that 11 represents revenue from a tax rate of two percent shall be deposited by the department 12 of revenue into the Missouri hemp development fund established under section 13 407.3091.
EXPLANATION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is intended to be omitted from the law. Matter in bold-face type in the above bill is proposed language. HB 1328 2
14 5. The tax levied under this section is separate from and in addition to any 15 general state and local sales and use taxes that apply to retail sales, which shall continue 16 to be collected and distributed as provided by law. 17 6. Counties, municipalities, and any other political subdivisions shall not impose 18 additional taxes or fees on intoxicating hemp products beyond the taxes authorized 19 under this section. 407.3070. 1. Sections 407.3070 to 407.3115 shall be known and may be cited as 2 the "Fair, Practical, and Responsible Hemp Regulations Act". 3 2. As used in sections 407.3070 to 407.3115, unless the context otherwise requires, 4 the following terms mean: 5 (1) "Batch", a single stock-keeping unit that has a common cannabinoid input or 6 a hemp flower of the same varietal and harvested on the same date and that is 7 manufactured during a defined cycle in such a way that it could be expected to be of a 8 uniform character; 9 (2) "Division", the division of alcohol and tobacco control of the department of 10 public safety; 11 (3) "Hemp", the plant Cannabis sativa L. and any part of that plant, including 12 the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and 13 salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol 14 concentration of not more than three-tenths of one percent on a dry-weight basis; 15 (4) "Hemp-derived cannabinoid", any cannabinoid, or isomer derived from the 16 cannabinoid, that is derived from hemp including, but not limited to, the following: 17 (a) Delta-9 tetrahydrocannabinol (delta-9 THC); 18 (b) Delta-8 tetrahydrocannabinol (delta-8 THC); 19 (c) Delta-10 tetrahydrocannabinol (delta-10 THC); 20 (d) Hexahydrocannabinol; 21 (e) Tetrahydrocannabinol acetate ester (THCO); 22 (f) Tetrahydrocannabiphorol (THCP); 23 (g) Tetrahydrocannabivarin (THCV); and 24 (h) Tetrahydrocannabinolic acid (THCA); 25 (5) "Hemp product", any product in which: 26 (a) At least one hemp-derived cannabinoid is contained in the product; 27 (b) Any cannabinoid, or isomer derived from the cannabinoid, contained in the 28 product is a hemp-derived cannabinoid; and 29 (c) Either: 30 a. If the product does not contain delta-9 THC, the product contains at least one 31 hemp-derived cannabinoid in a concentration of more than one-tenth of one percent; or HB 1328 3
32 b. If the product contains delta-9 THC, the concentration of the delta-9 THC 33 does not exceed three-tenths of one percent on a dry-weight basis; 34 (6) "Intoxicating hemp product", any hemp product that does not qualify as a 35 nonintoxicating hemp product; 36 (7) "License", a license issued by the division to a manufacturer or retailer 37 under section 407.3073; 38 (8) "Manufacturer", a person or entity that processes raw hemp materials into 39 hemp products for consumption or sale; 40 (9) "Nonintoxicating hemp product", any hemp product that, even if it contains 41 a hemp-derived cannabinoid known to produce intoxicating effects, is not formulated or 42 marketed as a product intended to produce euphoria, inebriation, or other similar 43 effects in the consumer; that is designed for therapeutic, nutritional, or wellness 44 purposes; and that is not intended to impair cognitive or motor functions in the 45 consumer. The term "nonintoxicating hemp product" shall include, but not be limited 46 to, the following: 47 (a) Any hemp product that does not contain any hemp-derived cannabinoid 48 other than: 49 a. Cannabichromene (CBC), including cannabichromene acid (CBCA) or 50 cannabichromevarin (CBCV); 51 b. Cannabicitran (CBT), including cannabitriolic acid (CBTA); 52 c. Cannabicyclol (CBL), including cannabicyclolic acid (CBLA); 53 d. Cannabidiol (CBD), including cannabidiolic acid (CBDA), cannabidivarin 54 (CBDV), or cannabidiphorol (CBDP); 55 e. Cannabielsoin (CBE), including cannabielsoic acid (CBEA); 56 f. Cannabigerol (CBG), including cannabigerolic acid (CBGA), 57 cannabigerovarin (CBGV), or cannabigerol monomethyl ether (CBGM); 58 g. Cannabinol (CBN), including cannabinolic acid (CBNA); or 59 h. Cannabivarin (CBV), including cannabivarinic acid (CBVA); 60 (b) Any hemp-derived animal feed product; 61 (c) Any hemp-derived fiber, grain, or topical product; and 62 (d) Any full-spectrum cannabidiol (CBD) product in which CBD constitutes at 63 least eighty percent of the total cannabinoid content and delta-9 THC does not exceed 64 three-tenths of one percent on a dry-weight basis; 65 (10) "Proof of age", a valid driver's license or government-issued identification 66 confirming a person's age as twenty-one years of age or older; 67 (11) "Retailer", a person or entity that sells hemp products to consumers for 68 personal use and not for resale. HB 1328 4
407.3073. 1. A person or entity shall not manufacture intoxicating hemp 2 products unless the person or entity holds a manufacturing license issued by the division 3 under this section. 4 2. A person or entity shall not sell intoxicating hemp products unless the person 5 or entity holds a retail license issued by the division under this section for each location 6 at which the retailer sells intoxicating hemp products. 7 3. Any holder of a license issued under this section shall pay an annual licensing 8 fee of: 9 (1) For manufacturers, two hundred fifty dollars; and 10 (2) For retailers, one hundred dollars per location. 11 4. All fees payable under this section shall be collected by the division and 12 transmitted to the department of revenue for deposit in the state treasury to the credit of 13 the hemp business fund established under section 407.3076. 14 5. An applicant for a license shall submit: 15 (1) The annual licensing fee; 16 (2) For a manufacturer, proof of compliance with product safety, testing, and 17 labeling requirements; and 18 (3) For a retailer, a description of the retailer's age-verification processes. 19 6. Licenses shall be valid for one year from the date of issuance and may be 20 renewed annually. Any renewal application shall be submitted at least thirty days 21 before the date on which the license expires and include proof of compliance with the 22 provisions of sections 407.3070 to 407.3115 along with the annual licensing fee. 23 7. An agricultural producer licensed under the United States Department of 24 Agriculture's hemp program shall not be subject to the licensing requirements of this 25 section, provided that the producer does not engage in the manufacturing or retailing of 26 intoxicating hemp products. 27 8. Nothing in sections 407.3070 to 407.3115 prohibits a manufacturer from 28 holding a retail license or a retailer from holding a manufacturing license, provided that 29 each license is obtained and the licensee complies with all provisions of sections 407.3070 30 to 407.3115. 31 9. Any manufacturer that uses fifty kilograms of raw cannabinoids or less per 32 year may engage in the activities of a licensed retailer at the location of its 33 manufacturing operations without obtaining a retail license. 34 10. Any person or entity that manufactures or sells intoxicating hemp products 35 without a license shall be subject to: 36 (1) A civil fine of up to five thousand dollars per violation; HB 1328 5
37 (2) Seizure and destruction of any products that fail to comply with sections 38 407.3070 to 407.3115; and 39 (3) A permanent prohibition from applying for a license. 40 11. Counties, municipalities, and any other political subdivisions shall not 41 require a local license to manufacture or sell intoxicating hemp products and shall not 42 collect any licensing fee from manufacturers or retailers. 407.3076. 1. There is hereby created in the state treasury the "Hemp Business 2 Fund", which shall consist of all fees authorized to be charged by the division under 3 section 407.3073 as well as the excise tax revenue collected under sections 144.028 and 4 407.3088 designated for deposit into the fund. The state treasurer shall be custodian of 5 the fund. In accordance with sections 30.170 and 30.180, the state treasurer may 6 approve disbursements. The fund shall be a dedicated fund and, upon appropriation, 7 moneys in this fund shall be used solely for the administration and enforcement of 8 sections 407.3070 to 407.3115 and section 144.028. 9 2. Notwithstanding the provisions of section 33.080 to the contrary, any moneys 10 remaining in the fund at the end of the biennium shall not revert to the credit of the 11 general revenue fund. 12 3. The state treasurer shall invest moneys in the fund in the same manner as 13 other funds are invested. Any interest and moneys earned on such investments shall be 14 credited to the fund. 407.3079. 1. A manufacturer shall ensure that the primary raw hemp ingredient 2 used in the manufacture of hemp products undergoes full-panel testing. The final hemp 3 products shall undergo potency testing before being released for sale. 4 2. Testing required under this section shall occur on a per-batch basis, and 5 results shall confirm compliance with federal and state safety standards. 6 3. Testing required under this section shall be conducted by an independent 7 laboratory accredited to the International Organization for Standardization (ISO)/ 8 International Electrotechnical Commission (IEC) 17025 standard by an accreditation 9 body recognized under the International Laboratory Accreditation Cooperation (ILAC) 10 Mutual Recognition Arrangement. 11 4. Full-panel testing of the primary raw hemp ingredient used in the 12 manufacture of a hemp product shall include testing for microbial contaminants and 13 any other substances specified by the division by rule. 14 5. Any sample failure may be resubmitted for confirmation of testing failure in 15 accordance with the following procedures: HB 1328 6
16 (1) If a reserve sample was retained by the same laboratory that produced the 17 certificate of analysis demonstrating a test failure, that laboratory may retest the 18 reserve sample following the failed test in order to confirm component compliance; 19 (2) If the retested sample passes for the suspect component or components, a new 20 sample from the same batch shall be drawn and submitted to a second laboratory for 21 complete retesting of all components required to be tested under the rules promulgated 22 by the division. If the second retesting conforms to all required tolerances, the batch 23 shall be deemed compliant with testing requirements and may be transported and 24 distributed in commerce; and 25 (3) If a reserve sample is not available from the initial laboratory or if a sample 26 fails either of the retests, the batch shall be deemed nonconforming with the testing 27 requirements. 28 6. (1) A manufacturer shall not transport, or allow transport of, a batch that has 29 failed microbial contaminant testing unless: 30 (a) The batch is further processed by a method that effectively sterilizes the 31 batch, the batch is retested following such processing, and the results of the retesting 32 show conformance with required tolerances; or 33 (b) The batch is rendered unusable. 34 (2) A manufacturer shall not transport, or allow transport of, a batch that has 35 failed THC concentration testing unless: 36 (a) The batch is further processed by a method that effectively dilutes the batch, 37 the batch is retested following such processing, and the results of the retesting show 38 conformance with required tolerances; 39 (b) The batch is under immediate transport to a licensed manufacturer for 40 purposes of diluting the batch and the batch and remediation plan are reported to the 41 division prior to transport; or 42 (c) The batch is rendered unusable. 43 (3) For all other component testing failures not described in subdivisions (1) and 44 (2) of this subsection, the manufacturer shall render the batch unusable. 407.3082. 1. Each batch shall have a certificate of analysis detailing the results 2 of the testing conducted under section 407.3079. 3 2. Manufacturers shall maintain certificates of analysis for each primary raw 4 hemp ingredient used in the manufacture of hemp products and provide them to 5 inspectors upon request. 6 3. Retailers shall maintain certificates of analysis for each batch of hemp 7 products they sell and provide them to inspectors upon request. HB 1328 7
8 4. The certificate of analysis shall be made available to consumers via a quick- 9 response code on the product label that provides access to: 10 (1) The batch number; 11 (2) The date of testing; and 12 (3) Testing results for each substance tested. 407.3085. 1. Each product label for a hemp product shall clearly display: 2 (1) Total cannabinoid content in milligrams per package and per serving, if 3 applicable; 4 (2) An ingredient list with potential allergens; 5 (3) The net weight of the product; 6 (4) A best-by date not exceeding two years from the date the batch from which 7 the hemp product originated was tested under section 407.3079; and 8 (5) A quick-response code linking to the certificate of analysis for the batch from 9 which the hemp product originated. 10 2. Each product label for an intoxicating hemp product shall include the 11 following warnings with the text for each warning as follows: 12 (1) "Consumption may impair the ability to operate heavy machinery or drive."; 13 (2) "Not for use by individuals under 21 years of age."; 14 (3) "Consult your physician before use if you are pregnant, breast-feeding, or 15 taking medications."; 16 (4) "This product has not been approved by the United States Food and Drug 17 Administration (FDA) for medical use."; and 18 (5) "Consuming hemp products may result in a failed drug test.". 19 3. Hemp products shall not be labeled or marketed to appeal primarily to 20 individuals under twenty-one years of age. The use of cartoon characters, mythical 21 creatures, or other juvenile imagery in the labeling or marketing of a hemp product 22 shall be prohibited. 23 4. Labeling or marketing of hemp products shall not mimic packaging or 24 branding of food, beverages, or other nonhemp products in a manner that could cause 25 consumer confusion. 26 5. Any advertisement for an intoxicating hemp product shall prominently 27 include the following disclaimer orally or in writing: "This product contains hemp- 28 derived cannabinoids. Use responsibly. Keep out of reach of children.". 29 6. Labeling or marketing of hemp products shall not infringe upon any 30 trademarks protected by the United States Patent and Trademark Office or the 31 Missouri office of the secretary of state. HB 1328 8
32 7. Unsubstantiated claims of medical benefits shall be prohibited in any labeling 33 or marketing of a hemp product unless approved by the United States Food and Drug 34 Administration. 35 8. Hemp-derived animal feed products and hemp-derived fiber, grain, and 36 topical products shall not be subject to the provisions of this section. 407.3088. 1. For all tax years beginning on or after January 1, 2026, an excise 2 tax is levied and imposed upon the retail sale of intoxicating hemp products to 3 consumers within this state at the rate and in the manner set forth in section 144.028. 4 2. The following penalties may be imposed on any retailer who fails to collect or 5 remit the excise tax imposed by this section and section 144.028: 6 (1) A civil fine of up to five thousand dollars per violation; and 7 (2) Suspension or revocation of any retail license. 407.3091. 1. There is hereby created in the state treasury the "Missouri Hemp 2 Development Fund", which shall consist of the excise tax revenue collected under 3 sections 144.028 and 407.3088 designated for deposit into the fund. The state treasurer 4 shall be custodian of the fund. In accordance with sections 30.170 and 30.180, the state 5 treasurer may approve disbursements. The fund shall be a dedicated fund and, upon 6 appropriation, moneys in this fund shall be used solely as provided in this section. 7 2. Notwithstanding the provisions of section 33.080 to the contrary, any moneys 8 remaining in the fund at the end of the biennium shall not revert to the credit of the 9 general revenue fund. 10 3. The state treasurer shall invest money