Colorado and Washington State took in more revenue from marijuana sales than from either alcohol or cigarettes in Fiscal Year 2022, according to a new report.
Another eight states saw tax revenue from cannabis outpace cigarettes, while Nevada took in more from marijuana than alcohol.
The analysis, published by the Tax Policy Center on Wednesday, provides a comprehensive overview of the various tax models, revenue data and debates over the most effective tax regimes in states that have legalized cannabis.
Here’s highlights of what they found. First, states and localities tax marijuana by weight, sales price, potency, or some combination. pic.twitter.com/uXX91muaAq
— Tax Policy Center (@TaxPolicyCenter) September 28, 2022
Researchers Richard Auxier and Nikhita Airi said that while it’s difficult to draw generalizations about marijuana tax policy given the patchwork of state and local tax models, there are several trends that have arisen since jurisdictions started implementing legalization. One of those trends is that, as cannabis markets have expanded, the plant is often eclipsing alcohol and cigarettes in terms of revenue it generates for tax coffers.
In Fiscal Year 2022, Colorado collected $353.7 million in marijuana tax dollars, just barely edging out cigarette tax revenue but nearly seven times more than what the state generated from alcohol excise taxes.
Washington State, meanwhile, took in $517 million in cannabis taxes, compared to…