The cannabis language is part of a compromise announced last week by Governor Abigail Spanberger, State Senator Lashrecse Aird and Delegate Paul Krizek. If the budget is ultimately enacted, licensed adult-use marijuana sales would begin in Virginia on July 1, 2027.
Virginia legalized adult possession of marijuana in 2021, but the state has never launched a regulated retail system, making it the only recreational cannabis state to not allow licensed sales. As a result, adults 21 and older can legally possess and grow marijuana, but there is still no legal recreational marketplace where they can purchase it.
Lawmakers have tried for years to change that. Previous retail sales proposals were vetoed, including a standalone measure earlier this year. The new approach places the adult-use sales framework inside the budget, giving lawmakers another path to enact the policy.
Under the proposal, the Virginia Cannabis Control Authority would regulate the market and begin accepting license applications on February 1, 2027. The plan allows up to 350 retail cannabis establishment licenses, with a phased rollout and provisions meant to support small businesses, microbusinesses and entrepreneurs.
The measure would also increase Virginia’s legal marijuana possession limit from one ounce to two ounces and allow adults to purchase up to two ounces in a single transaction.
The plan includes several consumer safety and youth prevention provisions, including child-safe packaging requirements, restrictions on cartoon advertising and a ban on products shaped like animals, fruits, vehicles or humans. Regulators would also be authorized to impose escalating penalties for retailers that fail to properly check identification.
Adult-use marijuana would be subject to a 6% state tax, increasing to 8% after July 1, 2029. Localities would be allowed to add a local cannabis tax of 1% to 3.5%, in addition to the existing retail sales and use tax.
Revenue from the market would support early childhood and K-12 education, behavioral health programs, substance use disorder prevention and treatment, public health programs and the Cannabis Equity Reinvestment Fund.
The budget now moves to the House of Delegates. If approved there, it would go to Governor Spanberger for consideration. Spanberger has said she will sign the proposal into law once it reaches her.
