CBD Shops Sell Cannabis Flowers Again

"At the latest from today, cannabis flowers will be sold again in cannabis specialty stores," said Klaus Hübner, chairman of the newly founded Austrian Cannabis Association (ÖCB), referring to a recent expert opinion by constitutional expert Heinz Mayer, in which he clarifies: "Legally tradable cannabis flowers are subject to tobacco tax, but are clearly not subject to the Austrian tobacco monopoly."

Decision by Customs Authority Led to Legal Uncertainty for CBD Shops

The trigger for the legal uncertainty was a decision by the customs authority at the end of 2024, which referred to a supreme court ruling by the Administrative Court. It interpreted this to mean that the sale of legal cannabis flowers was reserved exclusively for tobacconists and tobacco wholesalers - with reference to the Tobacco Monopoly Act. The impact was devastating, Hübner reported on Thursday at a press conference in Vienna: Almost 500 CBD shops in Austria suffered sales declines of up to 80 percent. There were penalty notices, tax demands, and bankruptcies. At the same time, customers migrated abroad - the Austrian treasury lost tax revenue and the industry faced an acute existential crisis.

Constitutional Lawyer Mayer Considers Tobacco Monopoly for Cannabis Unconstitutional

In his expert opinion for the Cannabis Association, constitutional lawyer Mayer states: "The court only decided that cannabis products are subject to the Tobacco Tax Act - that is correct, there is nothing to object to." This concerns not only the sale and taxation but also storage. "But regarding the Tobacco Monopoly Act, the Administrative Court explicitly said: No statement about the tobacco monopoly is to be made from the tobacco tax obligation." According to Mayer, an extension of the tobacco monopoly to cannabis would be unconstitutional, contrary to European law, and an impermissible interference with the freedom to conduct a business.

Why then had the shops not sold cannabis flowers in recent months? Mayer: "Well, because there was fear." Some media reported "quite diabolically" and "quite aggressively" that hemp shops would now have to close and sales would only be allowed in tobacconists. This was due to "the apparently incorrect interpretation by the Ministry of Finance," Mayer said. The Cannabis Association is also prepared to pursue legal clarification if necessary. "We are definitely prepared for an administrative procedure. This is also something that would suit us to a certain extent because then we would hand over this legal case to our legal representatives."

Ministry of Finance Still Sees Sales by CBD Shops as Prohibited

The Ministry of Finance reiterated its ongoing legal stance that CBD shops are not allowed to sell smokable hemp. "The financial administration adheres to legal norms as well as the findings of Austrian courts and emphasizes that privately commissioned expert opinions do not change the current legal situation." The expert opinion is under review, but "the sale of untaxed tobacco products" can still "have financial criminal consequences."

Need for Action on Tobacco Tax

One issue is still the payment of the tobacco tax. "We have informed the Ministry of Finance in advance about this problem. The situation is that there is no corresponding entry in the cash registers that can be selected for the 34 percent tobacco tax. One can help oneself by simply indicating 'abroad' as the location - but that cannot really be a serious solution," there is still a need for action from the finance side. The ÖCB has recommended to the specialist trade "not only to set aside the 34 percent tobacco tax but also an additional 20 percent value-added tax."

According to Hübner, the industry comprises about 500 to 1,000 companies - at least 400 of which are shops, but also include analytical laboratories and agricultural businesses, wholesalers, and importers. The ÖCB chairman calls for a separate cannabis law, as other countries already have. "We would recommend Switzerland, Liechtenstein, and the Czech Republic as role models. There, there is a one percent limit for THC in the area of freely tradable products." This is a more realistic value than the currently applicable limit of 0.3 percent. THC stands for tetrahydrocannabinol - it is the psychoactive main component of the cannabis plant that triggers the intoxicating effect ("high") when consuming marijuana or hashish. In contrast, the substance CBD (cannabidiol), which is also contained in the cannabis plant, has no intoxicating effect.

The ÖCB overall wishes for the decriminalization of cannabis. "I believe cannabis legalization is an unstoppable trend. That is, of course, a goal of ours." At the same time, however, a "clear and sensible and well-considered regulation" is also necessary.

(APA/Red)

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