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LEGISLATURE OF NEBRASKA
ONE HUNDRED NINTH LEGISLATURE
SECOND SESSION
LEGISLATIVE BILL 873
Introduced by Hallstrom, 1.
Read first time January 08, 2026
Committee: Revenue
A BILL FOR AN ACT relating to revenue and taxation; to amend sections1
71-3801, 71-3809, 71-3810, and 71-3812, Revised Statutes Supplement,2
2025; to provide an excise tax for certain kratom products; to3
change provisions relating to adulterated products under the Kratom4
Consumer Protection Act; to harmonize provisions; and to repeal the5
original sections. 6
Be it enacted by the people of the State of Nebraska,7
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Section 1. Section 71-3801, Revised Statutes Supplement, 2025, is1
amended to read: 2
71-3801 Sections 71-3801 to 71-3815 and section 2 of this act shall3
be known and may be cited as the Kratom Consumer Protection Act.4
Sec. 2. (1) Beginning July 1, 2027, an excise tax shall be levied5
on the retail sale of kratom products to consumers. The tax shall be at a6
rate of ten percent of the retail purchase price. 7
(2) The excise tax imposed by this section shall be in addition to8
all other occupation, privilege sales, or use taxes imposed by this state9
or by any political subdivision of the state. 10
(3) Each retailer of kratom products shall maintain complete and11
accurate electronic records of sales of kratom products, in the manner12
prescribed by the Department of Revenue. Each such retailer shall provide13
such records to the department upon request. 14
(4)(a) Each retailer of kratom products shall file a return with the15
department by the twentieth day of the month following the month reported16
and with the report shall remit the amount of excise tax due.17
(b) The return, which shall be upon forms prescribed and furnished18
by the department, shall contain, among other things, the total amount of19
kratom products sold or transferred during the preceding month and the20
amount of tax due thereon. 21
(c) The department may require retailers to file tax returns22
electronically and to remit payments due by electronic funds transfers.23
(5) The department shall collect the excise tax and shall account24
for and remit to the State Treasurer at least once each month all money25
collected pursuant to such tax for credit to the Property Tax Credit Cash26
Fund. 27
Sec. 3. Section 71-3809, Revised Statutes Supplement, 2025, is28
amended to read: 29
71-3809 (1) No person shall sell, offer for sale, provide, or30
distribute an adulterated kratom product in the State of Nebraska.31
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(2) A product shall be deemed adulterated if: 1
(a) It contains any kratom alkaloid or metabolite, including 7-2
hydroxymitragynine, and does not meet the definition of a kratom product3
under section 71-3802; or 4
(b) The kratom product is combined with a dangerous nonkratom5
substance that contains a poisonous or otherwise deleterious nonkratom6
ingredient, including, but not limited to, any substance listed as a7
controlled substance under the laws of this state or federal law.8
(3) If the department has a reasonable belief that Upon receipt of9
evidence that suggests a product may be an adulterated kratom product,10
the department may require the person selling, providing, or distributing11
the product to obtain an independent third-party test of the product by a12
laboratory of the department's choosing. A person shall not sell,13
provide, or distribute any product undergoing such testing until the test14
results verify that such product is not adulterated.15
Sec. 4. Section 71-3810, Revised Statutes Supplement, 2025, is16
amended to read: 17
71-3810 (1) Any processor or retailer that violates any section of18
the Kratom Consumer Protection Act, including those related to the19
application or registration, or any of the rules and regulations adopted20
and promulgated by the department that apply to processors or kratom21
products shall be subject to the penalties provided in this section.22
(2) For the first violation, the department shall impose a civil23
penalty of up to one thousand dollars. For the second violation, the24
department shall impose a civil penalty of up to five thousand dollars.25
For a third violation and any subsequent violations, the department shall26
impose a civil penalty of at least five thousand dollars and no more than27
twenty thousand dollars and, if the violator is a processor, the28
department shall prohibit the sale of any kratom products of such29
processor within the State of Nebraska for a period of three years.30
(3) If a processor violates the Kratom Consumer Protection Act by31
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selling, offering for sale, providing, or distributing an adulterated1
kratom product in the State of Nebraska, the department shall remove any2
product found to be adulterated from the list of registered kratom3
products on the department's website. 4
(4) (3) For any processor or retailer that has no violation for a5
period of four consecutive years, a new violation shall be treated as a6
first violation. 7
(5) (4) No determination that a violation has occurred shall be made8
until notice has been given and a hearing has been held by the Tax9
Commissioner as provided in section 71-3811 if requested by the processor10
or retailer. 11
(6) (5) A retailer shall not be found to be in violation of the12
Kratom Consumer Protection Act if it is shown by a preponderance of the13
evidence that the retailer relied in good faith upon the representation14
of a processor that a product is not an adulterated kratom product as15
defined in section 71-3809 or otherwise conformed to the act.16
Sec. 5. Section 71-3812, Revised Statutes Supplement, 2025, is17
amended to read: 18
71-3812 (1) The Attorney General shall have authority to enforce the19
Kratom Consumer Protection Act pursuant to the Consumer Protection Act20
and the Uniform Deceptive Trade Practices Act. This section shall not be21
construed to allow for a private right of action under the Kratom22
Consumer Protection Act even though such action is authorized under the23
Consumer Protection Act and the Uniform Deceptive Trade Practices Act.24
(2) If a kratom product is found to be adulterated under section25
71-3809 with ingredients not reflected on the label of the product, such26
violation of the Kratom Consumer Protection Act is also prima facie27
evidence of a violation of the Consumer Protection Act.28
Sec. 6. Original sections 71-3801, 71-3809, 71-3810, and 71-3812,29
Revised Statutes Supplement, 2025, are repealed. 30
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