Legal marijuana is producing billions in tax income for governments. In America, there’s a new “green rush.” So according to proponents, ten states that legalized recreational cannabis use received about $2.7 billion in additional taxes last year.
The Marijuana Policy Project, which advocates for more pot legalization, just released a new analysis on marijuana-related tax receipts, claiming that “legalizing marijuana for adults has been a prudent investment.” “After 2014, when sales began in Colorado and Washington, legalization legislation offers provided states with a new revenue stream to improve budgets and fund critical services and programmes,” the research continued. States reported a total of $7.9 billion in tax income from legal adult-use marijuana sales as of May 2021.
Cities and municipalities have produced hundreds of thousands of dollars in new money through local adult-use cannabis taxes, in addition to cash for statewide budgets.” Pot is authorized for recreational use in 17 jurisdictions, while therapeutic benefit with a doctor’s approval is legal in 36 states.
- However, weed use is still banned at the federal level. The analysis looked at tax regulations in each state, population size and expected adult marijuana consumption, and additional revenue from legalization, such as local city taxes. They discovered that sales, mainly edible, skyrocketed following the pandemic’s onset last year when more adults were looking for indoor recreational activities, and more stores began to provide sales online.
- California has the largest marijuana industry, having legalized recreational use in 2018 and collecting $1 billion in taxes on the commodity last year, up 62% from $397 million in 2019. Washington was one of the first states to legalize marijuana. Oregon’s tax revenues grew from $68 million in 2017 to $158 million in 2020. The state of Nevada, which has legalized its use since 2017, generated revenues of $123 million in 2020, up from $86 million in 2018. The Colorado budget manager counted $362.
- The marijuana tax in 2020 is $1 million, up 100% from $279 million in the previous year. The new market seems to be following this trend. Michigan generated nearly $50 million in annual revenues of $81.7 million from January to April 2020.
Reporters expect many other states that do not yet have an income tax to report similar figures, including Vermont, Arizona, New Jersey, Montana, South Dakota, New York, New Mexico and Virginia. Four states, including New Jersey, Arizona, South Dakota and Montana, have legalized recreational or medical drug use since the 2020 elections. In March, New York became the 15th state to approve recreational use.
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