Study shows high tax revenue from legal cannabis sales
Countries that have legalized cannabis were able to make billions in taxes.
Dirk W. MüllerOctober 2, 2026
States that have legalized adult marijuana sales have seen billions of dollars in fresh tax revenue from cannabis, according to a new study. The recently published study, courtesy of the Marijuana Policy Project, found that "states reported a total of $ 7.9 billion in tax revenue this month from legal adult marijuana sales," while "cities and Communities have also generated hundreds of thousands of dollars in new revenue from local adult cannabis taxes ". That number includes the states of Colorado and Washington, where voters passed legalization measures in 2012 and where sales began in 2014. Colorado has a 15 percent wholesale tax and a 15 percent specialty retail tax (neither of which applies to medical cannabis sales in this state), according to the study. As of 2014, Colorado's estimated tax revenue from cannabis sales is $ 1,557,878,973, with "$ 404.5 million of total cannabis tax revenue being used to improve Colorado's public school system." The estimated tax revenues do not include "local sales tax revenues that were significant," according to the study. Denver, for example, generated $ 210.6 million in local tax revenue as of last month. In Washington, which has had a 37 percent retail tax and 6.5 percent sales tax as of July 2015, the estimated state tax revenue from cannabis sales rounds up to $ 2,568,728,290, which doesn't include the estimated 167 million $ generated between July 2014 and March 2021. "By July 2015, taxes were quite high - 25% at three delivery points - which made it difficult to compete with illegal sales. In addition to changing the tax rate to 37% in 2015, the legislature created a medical endorsement program to which Adult-use businesses could apply to join, "the report detailed. "In tax years 2019 and 2020, state officials reported that 37 percent cannabis sales tax revenue exceeded alcohol tax revenue, despite the fact that many more adults consume alcohol than cannabis.4 For every billion dollars in revenue Taken from cannabis sales tax, nearly $ 600 million goes to public health initiatives, including a fund that provides health insurance for low-income families. " Oregon's first adult marijuana sales began in 2016, but the state has raised $ 540,071,765 since then. In Alaska, state marijuana tax revenues are estimated at $ 78,218,573 as of 2016, with 2020 being a record year with tax revenues exceeding $ 27 million. "Eighteen states have laws legalizing, taxing, and regulating cannabis for adults age 21 and older. Eight of the laws were passed in 2020 or 2021, and seven of those states have not yet started licensing and tax collection," the report said, noting that he is reviewing "the tax structure of each state on adult cannabis, the general public and the revenues from legalization". "It does not include medical cannabis tax revenue, application and licensing fees paid by cannabis companies, additional income taxes generated by workers in the cannabis industry, or corporate taxes paid to the federal government," he said. The results of this study by the Marijuana Policy Project will come as no surprise to legalization advocates who have long touted adult marijuana use and medical marijuana as a boon to the local economy. An economic analysis published last year found that in Texas, where recreational marijuana is still illegal, legalization could generate more than half a billion dollars a year in new state tax revenues. "A regulated cannabis market would be an economic boon for the Lone Star State," said the report, which is written by Vicente Sederberg LLP. "Hundreds of millions of dollars in new tax revenue and tens of thousands of new jobs would be particularly helpful in overcoming the losses caused by the COVID-19 pandemic. Texas is leaving a tremendous amount of money on the table by keeping cannabis illegal."
