Restriction on Sale of Cannabis Flowers

Experts predict that the ruling by the Administrative Court (VwGH) on the sale of cannabis flowers, reported by "Standard" and "Presse" in their Friday editions, will result in additional revenue for the state in the tens of millions.

Sale of Cannabis Flowers Only Allowed in Tobacconists in the Future

Cannabis or hemp flowers with a very low THC content - less than 0.3 percent - are not considered addictive substances and may be traded, possessed and used for consumption. The calming ingredient CBD, which ensures high sales, is particularly popular among consumers. As the VwGH has now determined, dried hemp flowers as smokable products fall within the scope of the Tobacco Monopoly Act. Therefore, their sale is only allowed in tobacconists, and they will also be subject to a tax rate of 34 percent in the future.

The background to the ruling is a complaint by a Vorarlberg hemp shop to the Federal Finance Court. The company had imported dried flowers in large quantities from Switzerland, whereupon the Austrian Customs Office/Customs Office Feldkirch prescribed almost 30,000 euros in tobacco tax for it. Its argument: The imported product is not tobacco at all. However, as the court pointed out, this is irrelevant: The Tobacco Tax Act also covers smokable products that are partially or entirely made of substances other than tobacco. The Federal Finance Court allowed a revision to the VwGH, which ultimately confirmed its view.

Far-reaching Consequences Due to Restrictions on the Sale of Cannabis Flowers

The ruling of the Supreme Court must be implemented immediately, as confirmed by the Ministry of Finance to the APA. The Ministry did not initially provide estimates of how much additional revenue the state could receive. According to "Standard", up to 15 million euros can be expected, while "Presse" writes, referring to information from a tax law expert, of a "medium double-digit" million amount.

The ruling could mean severe economic cuts for hemp shops, as CBD products sometimes make up a large part of their turnover. Hannes Hofer, head of the monopoly administration, estimates the market volume for legal smokable hemp at around 50 million euros, according to "Standard".

(APA/Red)

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