Cannabis Tax Revenue in States that Regulate Cannabis for Adult Use
Submitted by Marijuana Policy Project
It has been over a decade since the first adult-use cannabis markets launched in Washington and Colorado in 2014. Since then, legalizing cannabis for adults has generated nearly $25 billion dollars in state tax revenue to invest in the needs of the states.
Twenty-four states have legalized cannabis possession for adults 21 and older. All but one of them — Virginia — have also legalized, regulated, and taxed cannabis sales. In two legalization states — Delaware and Minnesota — sales have not begun yet.
States have generated a combined total of more than $24.7 billion in tax revenue from legal, adult-use cannabis sales. In 2024 alone, legalization states generated more than $4.4 billion in cannabis tax revenue from adult-use sales, which is the most revenue generated by cannabis sales in a single year. In 2024, seven states collected over $200 million in adult-use cannabis taxes. Four of those states generated over $500 million in revenue, one of which collected over $1 billion.
States with legal, adult-use cannabis sales have allocated tax revenues to a variety of needs, including their General Funds and specific services and programs. Cannabis taxes have provided funding for Medicaid, education, school construction, housing, roads, early literacy, bullying prevention, behavioral health, alcohol and drug treatment, veterans’ services, conservation, job training, conviction expungement expenses, and reinvestment in communities that have been disproportionately affected by the war on cannabis, among many others.
This document reviews each legalization state’s adult-use cannabis tax structure, population, and year-by-year adult-use cannabis tax revenue. States are listed in chronological order, based on when state-legal cannabis sales began, with the most mature markets first. These figures include cannabis excise taxes and states’ standard sales taxes that are applied to cannabis. They do not include medical cannabis tax revenue, application and licensing fees paid by cannabis businesses, income taxes generated by workers in the cannabis industry, or taxes paid to the federal government. These figures also omit cities and towns’ tax revenue from municipal adult-use cannabis taxes.
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