These two U.S. states got more tax money from Cannabis than from alcohol or cigarettes


‘There is no standard cannabis tax in the U.S. the way there is an alcohol tax, cigarette tax and gas tax’.

With every new year, legal cannabis states provide support that the plant is a good source of income.​

Indeed, in fiscal year 2022, the states of Washington and Colorado had more revenue from cannabis sales than from alcohol or cigarettes.

These numbers were recently published by the Tax Policy Center.

In all, the group reported that “19 states now have enacted taxes on recreational marijuana purchases, but the tax regimes vary quite a bit.”

The tweet adds, however, “Over time, states can collect a significant amount of revenue, and Colorado and Washington collected more from taxes on cannabis than alcohol or cigarettes in 2022.”

The report explains why cannabis taxes work differently than those for alcohol or cigarette taxes, which are standardized throughout the U.S.

“While 19 states have enacted a tax on recreational marijuana, there is no standard cannabis tax in the U.S. the way there is an alcohol tax, cigarette tax and gas tax. Instead, governments use three different types of cannabis taxes: a percentage-of-price-tax, a weight-based tax and a potency-based tax. Different states use different taxes and some states levy multiple taxes.”

Colorado collected US$353.7 million in cannabis tax dollars in fiscal 2022, while Washington collected US$517 million (the latter state, for example, took in about US$490 million from alcohol and US$380 from cigarettes).

These numbers highlight various that are important for cannabis supporters: Not only do these states make a significant amount of revenue, the data also lends credence to the belief that legal cannabis could curb consumption of substances such as alcohol, cigarettes and, perhaps, even opioids.

Just this week, a study conducted in Florida found that medical marijuana users are less likely to use opioids. Participants explained that cannabis treated the symptoms of their disease (including anxiety, chronic pain and post-traumatic stress disorder) while also helping them curb or eliminate their use of prescription pills.

Region: United States