NC Lawmakers React to Retail Cannabis Marketplace Announcement in Virginia

Virginia Governor Abigail Spanberger has announced a compromise agreement to launch a legal retail cannabis market by July 2027, featuring a licensing system for up to 350 businesses. The move has prompted North Carolina lawmakers to express concern over the potential loss of tax revenue to their northern neighbor, given North Carolina's estimated $3.2 billion unregulated market. While North Carolina currently focuses on regulating hemp-derived products and kratom, the Virginia model is expected to influence future legislative debates regarding full legalization in the Tar Heel State.

Virginia's Governor Abigail Spanberger announced a deal to establish a safe, legal, and well-regulated cannabis market set to launch in July 2027. The proposed system will issue licenses to as many as 350 businesses, transitioning the state from its current status where possession is legal but retail sales are not. To support these new enterprises, the state will levy a 6% tax in addition to standard sales taxes, with 75% of those proceeds directed into a fund providing capital access for businesses operating within the strict regulatory environment.

North Carolina officials are closely monitoring these developments, with Representative Zack Hawkins of the North Carolina Advisory Council on Cannabis warning that the state is falling behind regional peers. The council, which was formed by Governor Josh Stein in 2025, reports that North Carolina’s unregulated cannabis market is one of the largest in the U.S., valued at roughly $3.2 billion in annual sales. Hawkins anticipates that approximately 10% of residents, particularly those within an hour of the border, will likely travel to Virginia to make legal purchases, resulting in a significant loss of potential tax revenue for North Carolina.

While Virginia moves toward a full retail model, North Carolina lawmakers are currently focused on more incremental regulations regarding hemp-derived products and kratom. A Senate bill currently in committee seeks to penalize businesses for selling hemp gummies and drinks to minors, though Senate Leader Phil Berger suggests the legislation may not yet go far enough. Despite the current legislative gap, advocates expect that Virginia’s licensing and tax structure will provide a blueprint for North Carolina as it eventually weighs the safety and economic benefits of a regulated marketplace against its existing unregulated trade.