Opening a Cannabis Business? These U.S. States Levy the Lowest Taxes on Recreational Cannabis – SFGate

The cannabis industry has gone from budding to booming in the past few years. Recreational cannabis sales are legal in 18 states to date (and Washington, D.C.) and in 2020, Americans spent over $18 billion on legal weed – a 71% increase from the year prior.

But if you’re considering jumping on the green bandwagon, keep in mind that cannabis isn’t like other industries (at least, not yet.) Because cannabis is not legal at the federal level, regulations on selling it vary wildly from state to state. So, if you’re a canna-entrepreneur wondering where to put down roots, it’s important to consider the regulations in each state where weed is legal.

One thing you’ll want to consider is taxes. Sales taxes on marijuana have been a huge motivator for states to legalize it (particularly as the economy recovers from COVID-19) and every state taxes the product differently depending on their goals.

RELATED: Can you get rich from cannabis? We look at the best marijuana investments as weed becomes legal in more states

According to a report released this year by Chamber of Commerce, a digital resource for small businesses, the two states with the lightest taxes levied on cannabis dispensaries are Michigan, with a sales tax of 10% and no additional taxes, and Massachusetts, with a sales tax of 10.75% and no additional taxes.

Olivia Thomson, a spokesperson for Chamber of Commerce, told GreenState the simple structure of cannabis taxation in these states can also make it easier for cannabis businesses to thrive.

“Due to their easy-to-follow tax structure and, in some cases, the higher cost to

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