Louisiana House Bill HB235

Louisiana 2025 Regular Session

• Introduced: 4/1/25
• Refer: 4/1/25
• Refer: 4/14/25

Caption

Increases the excise tax levied on consumable hemp products and dedicates revenues collected from the tax (OR +$5,100,000 SD RV See Note)

Summary

HB 235 increases Louisiana’s excise tax on retail sales of consumable hemp products from 3% to 20% of the retail sales price, effective for taxable periods beginning on or after July 1, 2025. The bill keeps the tax in addition to existing state and local sales taxes and requires retailers to report and remit the tax monthly. The bill also changes how the tax revenue is distributed. Instead of all proceeds going to the Louisiana Early Childhood Education Fund, HB 235 splits the revenue among four destinations: 15% to early childhood education, 30% to the Criminal Justice and First Responder Fund, 30% to the Drug Abuse Education and Treatment Dedicated Fund Account, and 25% to a newly created Consumable Hemp Testing and Regulation Fund. That new fund is intended to support a preferred university-affiliated hemp-testing laboratory in Louisiana, or, if none is available and approved, another public-university-affiliated lab, and ultimately the Louisiana Department of Health’s hemp regulatory activities if no qualifying lab exists.

Impact

HB 235 would amend Louisiana tax law governing consumable hemp products by sharply increasing the excise tax rate and redirecting the resulting revenue into multiple dedicated funds. It also creates a new special fund in the state treasury for hemp testing and regulation, and it modifies the existing Drug Abuse Education and Treatment Dedicated Fund Account and the disposition of hemp tax collections under R.S. 47:1696. The bill would affect retailers of consumable hemp products, hemp product consumers, university-affiliated laboratories that test these products, and the Louisiana Department of Health.

Sentiment

Based on the bill text and the absence of recorded committee discussion or votes in the provided materials, the overall sentiment appears policy-driven and revenue-focused rather than overtly contentious in the record available here. The bill’s structure suggests support for using hemp tax revenue to fund early childhood education, public safety, drug treatment, and hemp testing/regulation. No committee testimony or vote history is provided to indicate opposition or amendment debate.

Contention

The main potential points of contention are the size of the tax increase—from 3% to 20%—and the policy choice to impose a higher burden on consumable hemp products, which could affect pricing, sales, and market competitiveness. Another likely issue is the revenue split, particularly the diversion of funds away from the existing early childhood education allocation and toward criminal justice, drug treatment, and hemp regulation. Stakeholders most likely to disagree include hemp retailers and industry participants, public health and regulatory interests, education advocates, and entities that would benefit from the dedicated funding streams.