Last year, California passed the law AB-45, which paved the way for a regulated CBD market in the state. However, California flip-flopped on inhalable CBD products. The previous CBD legislation would have allowed them, but later drafts of AB-45 banned them. In the end, we reached an interesting compromise that made basically everyone unhappy. I’ll unpack it a little more today.
AB-45 very clearly states that both the manufacture and sale of inhalable CBD products are prohibited in California. Before I go any further, I should point out that “inhalable products” can include anything that people smoke: vaporizers, vape cartridges, smokable hemp, hemp cigars, etc.
Right now, no one can make or sell inhalable CBD products in California with one big exception: the state allows people to make these products ONLY IF they are intended for sale in other states. Weird, right? The California Department of Public Health (CDPH) has a separate registry for manufacturers of inhalable products for out-of-state sales, which I wrote about here.
All this could change. AB-45 clearly states that the ban on in-state manufacture and sale will end if the state legislature passes a tax on inhalants. Knowing California’s history with cannabis taxes, the taxes would be high if they were to pass. Also, if the legislature ever gets around to passing a tax law on inhalable CBD products, the products will be heavily regulated. On the one hand, all existing tests and other requirements will apply to inhalable products. And besides:
Inhalable CBD products could only be sold to people over the age of 21. Inhalable CBD products should not contain:
Aromas different from natural terpenes.
Polyethylene glycol (PEG).
Vitamin E Acetate.
Medium chain triglycerides (MCT oil).
Squalene or squalane.
Any other substance that [CDPH] considers it a danger to public health.
The CDPH would likely develop additional regulations for inhalable CBD products and would certainly develop a new registration form.
As far as we can tell, there is no proposed legislation to tax inhalable CBD products. Until that happens, the status quo remains and these products cannot be legally sold here. Since we’re at the end of a legislative session, we likely won’t see movement until 2023. So stay tuned to the Canna Law blog for more details on inhalable and California CBD products.