As the election season begins to heat up with the already-simmering summer temperatures across the country, more states are contemplating legalizing adult-use marijuana as a means to attract votes and generate much-needed tax revenue.
Since Colorado and Washington became the first two states to legalize recreational cannabis for adults over 21, 23 more have established adult-use marijuana industries, including the most recent additions of Minnesota and Ohio last summer.
One of the primary justifications for and benefits of a legal and regulated recreational market is the substantial tax revenue generated by the lucrative and wildly popular markets. According to a new report by the Marijuana Policy Project (MPP), since Washington and Colorado opened their first recreational dispensaries, state treasuries have collected over $20 billion in tax revenue from adult-use sales.
In that same report, researchers also revealed that in 2023 alone, states amassed over $4 billion in taxes despite mature markets like Colorado and Nevada reporting significant declines in their annual sales revenues. Newer markets in Michigan and Massachusetts reported massive increases in sales last year. Likewise, with Ohio, Delaware, and Minnesota markets set to go online soon, those figures will only surge higher.
“State-legal cannabis sales continue to provide significant economic benefits. With over $20 billion generated in adult-use cannabis tax revenue since the first sales began, the legal cannabis industry is providing much-needed funding for crucial services and programs in states across the country,” Karen O’Keefe, director of state policies at MPP, said in a press release.
"State-legal cannabis sales continue to provide significant economic benefits. With over $20 billion generated in adult-use cannabis tax revenue since the first sales began, the legal cannabis industry is providing much-needed funding for crucial services and programs in states across the country."
- Karen O’Keefe, Director of State Policies at the Marijuana Policy Project
In that same statement, O’Keefe also underlined the additional benefits of adult-use markets, particularly in creating good, high-paying jobs for state economies struggling to keep their citizens employed amid volatile market shifts and collapses.
"Additionally, the implementation of adult-use cannabis markets has spurred significant job growth, creating hundreds of thousands of new employment opportunities, along with thousands of new small businesses," she said.
"Additionally, the implementation of adult-use cannabis markets has spurred significant job growth, creating hundreds of thousands of new employment opportunities, along with thousands of new small businesses."
- Karen O’Keefe, Director of State Policies at the Marijuana Policy Project
The MPP report only provides data from adult-use cannabis taxes and does not detail any revenue generated from medical marijuana sales, which are legal in 38 states.
The totals for each state are as follows:
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Alaska: $28,097,114
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Arizona: $257,929,322
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California: $1,082,452,368
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Colorado: $256,756,467
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Connecticut: $24,613,367
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Illinois: $552,166,729
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Maine: $35,593,347
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Maryland: approx. $29,880,000
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Massachusetts: $263,488,752
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Michigan: $473,303,560
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Missouri: $105,941,225
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Montana: $51,636,106
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Nevada: $178,135,259
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New Jersey: $45,083,223
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New Mexico: $67,440,312
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New York: approx. $21,000,000
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Rhode Island: $12,621,982
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Oregon: $148,133,667
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Washington: $532,516,060
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Vermont: $21,642,857
Overall Total: Approx. $4,188,431,717
The record sales totals generated by a handful of critical states in the past few years are particularly noteworthy. Since 2018, when adult-use cannabis sales began, the state of Massachusetts has generated more than $7 billion in combined recreational and medical marijuana sales. Similarly, New Mexico retail dispensaries recently topped $1 billion in sales since adult-use cannabis became legal in 2022.
Last February, investment firm TD Cowen projected that legal cannabis sales would exceed $37 billion by 2027, an increase of almost $8 billion over 2023’s approximately $29 billion in sales. With much of that increase being siphoned off from the alcohol industry, the revolution currently manifesting via marijuana could radically transform the economic, cultural, and political landscape of America in the coming years.
All that remains is for the federal government to once and for all address its policy of prohibition against cannabis. When that domino eventually falls, the true power of the plant will be unleashed.
