On January 20, 2021, the Democratic party took control of both the United States Senate and the House of Representatives (though only with the vice president’s tie-breaking vote in the Senate).
Democrats have generally shown more interest than Republicans in marijuana legalization, so many people are hopeful that we could see some movement on the issue during this Congress.
Will a more pro-marijuana Congress mean positive movement on marijuana stocks? That remains to be seen — but one thing that could help move legalization forward is the ever-increasing amount of tax revenue generated by marijuana.
Some early legalizers have made over $1 billion in tax revenue from recreational cannabis already. As other states watch the cash roll in, they may be more motivated to open their state to legalized marijuana.
Here are the statistics on how much states make from marijuana taxes, how they tax cannabis, and what they use that money for.
Marijuana tax revenue by state in 2020
The table below shows the revenue collected in states with operational marijuana programs in 2020. Total tax collected varies depending on state population, how long the program has been established, and the method of taxation.
California, for example, represents the largest market for recreational marijuana, with approximately $3.1 billion of legal sales in 2019.
However, recreational marijuana was legalized more recently than in neighboring locales and in 2018 the illegal market still accounted for approximately 80% of recreational marijuana purchases.
As this distribution shifts over time, revenue collection is expected to increase.
State 2020 marijuana tax revenue Alaska $23,864,759 California $778,200,000* Colorado $387,480,110 Illinois $52,783,471 Massachusetts $81,734,083 Nevada $105,180,947 Oregon $133,150,349 Washington $469,200,000