Push to Repeal New York Medical Cannabis Tax Amid "Crisis" Claims
New York medical cannabis operators and patients are rallying behind a proposal in the state Legislature to repeal the state’s 3.5% excise tax on medical marijuana (MMJ).
State Sen. Jeremy Cooney, who introduced legislation last year to eliminate the tax, spoke at a rally at the state Capitol on Wednesday. He argued that a medical cannabis tax imposes an unfair burden on patients who cannot seek healthcare reimbursements for their medication.
Cannabis “should not be treated any different than any other medication that a prescriber would use to treat their patients,” Cooney said, according to a press release. The tax is currently assessed on manufacturers, distributors, or sellers, who pass the cost on to consumers.
Is New York’s Medical Cannabis Program in Crisis?
New York’s vertically integrated medical cannabis licenses, known as “registered organizations,” are limited to just 10 statewide. Most are held by multistate operators (MSOs), only some of whom have paid the multimillion-dollar fee required to convert to dual-use (medical and adult-use) operations.
Data highlights a downward trend for the medical sector:
Sales Decline: Through November 2025, New York medical cannabis retailers reported $95.5 million in sales, a significant drop from $140 million in 2024.
Overall Market: In contrast, total cannabis sales in the state reached $1.7 billion last year and are on pace to hit $2.6 billion in 2026.
Program Stats (as of Nov. 30): * 31 open medical dispensaries.
11 co-located medical and adult-use dispensaries.
81,500 registered patients (out of a population of nearly 20 million).
4,647 registered certifying providers.
Should Medical Cannabis be Taxed?
Last year, Gov. Kathy Hochul signed a bill intended to boost medical operators by allowing out-of-state patients to use New York dispensaries and adjusting possession limits. However, the New York Medical Cannabis Industry Association, which represents registered organizations, maintains that "the medical cannabis program is still in crisis."
Sen. Cooney and patient advocates argue that the current tax drives patients toward cheaper alternatives, including the illegal market or adult-use stores that may not offer the specialized products patients need. Eliminating the tax is seen as a way to make medical marijuana more accessible, particularly for veterans and patients managing chronic pain or the side effects of chemotherapy.
