Missouri Marijuana Business

What is the Demand for Marijuana in Missouri?

Missouri voters passed Constitutional Amendment 2 to legalize medical marijuana in November 2018. The constitutional amendment known as Article XIV places the management of medical marijuana under the Missouri Department of Health and Senior Services (DHSS).

According to the DHSS 2021 Annual Report, there are 62 marijuana cultivation facilities, 89 marijuana manufacturing facilities, and 192 registered medical marijuana dispensaries in Missouri. Furthermore, medical marijuana patients in Missouri grew from 22,706 registered patients in 2019 to 156,005 active patients in 2021, an increase of 587%. In addition, there are 4,979 registered agents (marijuana business owners, managers, employees, and operators) to meet the increasing demand for medical marijuana in Missouri.

In 2019, medical marijuana brought revenue of $18,723,704.63 to the state, as reported in the DHSS 2019 Annual Report. The 2021 Annual report showed revenue collected from medical marijuana taxes and fees were $21,530,724 and $13,971,784 for 2020 and 2021 respectively. In the 2 years (October 2020 to May 2022) that medical marijuana dispensaries became operational, over $335 million worth of medical marijuana has been sold in Missouri.

Missouri legalized recreational marijuana on December 8, 2022 and the first legal sale of adult-use cannabis occurred in the state on February 3, 2023. In the DHSS’ published report, the lifetime total sales of medical and recreational marijuana in Missouri is $992.5 million as of April 2023. Right from the first month in which adult-use cannabis became legally available, it sold more than medical marijuana. For April 2023, Missouri recorded $90.1 in sales for adult-use marijuana, about three times the amount of medical marijuana sold in the same month.

How is Marijuana Taxed in Missouri?

Article XIV of the Missouri constitution mandates a 4% tax on medical marijuana retail sales. The tax is intended to fund Missouri Veterans’ Health and Care fund. The Missouri Department of Revenue Financial and Statistical Report for the 2021 financial year showed that $2,024,672 was received as tax from marijuana sales in 2021.

The DHSS is to transfer revenue from medical marijuana retail tax, annual licensing fees for marijuana businesses, and medical marijuana registry program enrollment and renewal fees by patients and caregivers to the Missouri Veterans Commission (MVC). The law permits the DHSS to remove their operational cost from the total revenue and then transfer the remainder. The department transferred $2,135,510 to the MVC in 2020 from the money made from licensing marijuana facilities and medical marijuana patients and caregivers. In 2021, $6,843,310 was transferred to the MVC, and in May 2022, DHSS transferred $5 million.

The Missouri Veterans’ Health and Care fund is used to support veterans in some of the following ways:

• Veteran service programs

• General operations

• Maintenance of Missouri veteran homes

• Housing assistance

• Job training

• Drug rehabilitation services

• Tuition assistance

• Health care and mental health services

What is the Agency Taxing Marijuana Business in Missouri?

The Missouri Department of Revenue (DOR) is the state agency responsible for collecting taxes in the state, including marijuana retail sales tax. Article XIV of the Missouri Constitution empowers the DOR to collect the medical marijuana retail sales tax. There are no additional taxes on medical marijuana in Missouri. Furthermore, the medical marijuana retail sales tax is collected from medical marijuana dispensaries only. The DOR uses a percentage-of-price tax system which implies that the 4% tax is calculated using the retail price of the medical marijuana product at the time of purchase. The DOR retains 5% of marijuana tax collected for their operations and remits 95% to the Department of Health and Senior Services (DHSS).

Marijuana dispensaries must file their medical marijuana retail sales tax with Form 5808. The Department of Revenue has an online portal (MyTax portal) for Marijuana Dispensaries to file and remit their taxes. The DOR does not accept cash for tax payments. Moreover, marijuana dispensaries may also send checks, drafts, or money orders of their marijuana retail sales tax by mail. They should be made payable to the Director of Revenue and mailed to:

Missouri Department of Revenue

PO Box 3380

Jefferson City, MO 65105-3380