Legalizing the retail production and sale of cannabis in the United States would yield over $3 billion in annual tax revenue, according to an analysis published this week by the personal finance website, NerdWallet.com.
Authors provided a state-by-state economic analysis, taking into account available data estimating marijuana use rates (for those age 25 and older), cannabis market size, and state and local tax rates. Researchers also assumed a flat, 15 percent excise tax on commercial marijuana production. (This excise tax rate is presently imposed in Colorado.)
Based on existing market projections, California would gain the largest amount of annual tax revenue ($519,287,052) were commercial cannabis production and sales to be legalized for adults. Other top tax revenue generating states include: New York ($248,103,676), Florida ($183,408,640), Texas ($166,303,963), and Illinois ($126,107,360).
Washington, which began allowing retail cannabis sales this summer, is estimated to reap some $119,000,000 in annual tax revenue, according to the study’s projections. Colorado, which has allowed retail cannabis sales since January 1, 2014, is estimated to gain some $78,000,000 in annual revenue.
Revenue projections for all 50 states are available online here.
By Paul Armentano, NORML Deputy Director