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South Dakota
Cannabis Market
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South Dakota Cannabis Market At-A-Glance

Overall Rating: B+
South Dakota is in the early stages of legalization, and voters made history in November 2020 by legalizing medical marijuana and adult-use cannabis in one fell swoop. The law is currently held up by the state Supreme Court so all ratings anticipate future legalization implementation.
Medical Use: Yes
Adult Use: Yes, limited
Market Potential
B+
Recreational cannabis will most likely be available to purchase mid-to-late 2022. The Department of Revenue has until April 1, 2022, to craft rules and issue regulations for the adult-use program, but it’s unclear how long after that date it will take for stores to be up and running.
Licensing
C+
While regulators are developing the program details and regulations, cannabis entrepreneurs who hope to win a license should start planning now. A solid business plan and financial model can help put you ahead of the competition with important early steps like raising funds and finding your best location. Four license types will be awarded: Cultivation, Wholesale/Processing, Retail, and Lab/Testing. Patient registration cards will be issued starting November 18, 2021.
Competition
B+
The South Dakota Department of Health is required to enact rules related to implementing the medical marijuana program by October 29, 2021. The South Dakota State Legislature is expected to pass laws providing for an adult-use cannabis program by April 1, 2022.
Tax/Regulatory Structure
B
The Department of Revenue will adopt rules and regulations to implement. Adult-use cannabis will be taxed at 15%. Medical marijuana will not be taxed.

South Dakota Cannabis Details

Population (Rank)
851,058
#46
Size/Density
77,116 sq. miles
#17
Medical Cannabis?
Yes
2020
Adult-Use Cannabis?
Yes, limited
2020
2021 Medical Sales
2022 Projected Medical Sales
NA
NA
NA
NA Adult Use Sales
2022 Projected Adult Use Sales
NA
NA
NA
Regulatory Agency
Medical Cannabis in South Dakota
https://medcannabis.sd.gov/
# of Dispensaries (allowed/issued)
No limit
0
# of Cultivators (allowed/issued)
No limit
0
# of Manufacturers (allowed/issued)
No limit
0
# of Testing Labs (allowed/issued)
No limit
0
Vertical Integration?
Allowed
Residency Requirements?
TBD
Social Equity?
TBD

Cannabis Taxes

Combined Tax Rate
5.62%
Excise Tax
NA
Retail Sales Tax
4%
Local Sales Tax
4%
State Sales Tax
4.5%
Cultivation Tax
NA

Licensing Fees (per year)
*Varies based on gross revenue

Cultivator
TBD
Laboratory License
TBD
Retail Storefront
TBD
Wholesale Processing
TBD

Application Fees

Cultivator
TBD
Laboratory Testing
TBD
Marijuana Processor
TBD
Retail Storefront
TBD
29/09/2021

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