13 Cannabis Tax Revenue Statistics: State Totals, Top States, and Tax Rates
How much states collect from legal cannabis, which states collect the most, why mature markets are collecting less, and how cannabis tax rates compare.
Every legal cannabis purchase carries tax, and those taxes now add up to billions of dollars a year for state budgets. The Marijuana Policy Project's state-by-state tally shows states have collected $28.4 billion in adult-use cannabis taxes since the first stores opened in Colorado and Washington in 2014. The figures below cover national totals, the top-earning states, why mature markets are collecting less, and how cannabis tax rates differ. All revenue figures count state excise and sales taxes on adult-use sales only; they exclude medical cannabis taxes, local taxes, and licensing fees.
Key Takeaways
- $28.4 billion and counting. States have collected $28.44 billion in adult-use cannabis taxes from 2014 through 2025.
- 2025 set a record. Adult-use cannabis taxes brought in $4.57 billion in 2025, the most in any single year.
- California crossed $1 billion. California collected $1.05 billion in 2025 and $7.76 billion since sales began.
- Mature markets are collecting less. Colorado's cannabis tax revenue peaked at $396 million in 2021 and fell to $221 million in 2025 as prices dropped.
- Rates vary widely. State cannabis excise rates range from 6% in Missouri to 37% in Washington, and three states tax by THC content.
- The money funds schools and health care. Colorado has directed more than $1.5 billion to public schools, and over half of Washington's revenue goes to health care for low-income children.
National totals
1. States have collected $28.4 billion in adult-use cannabis taxes
From the first legal sales in 2014 through 2025, states collected a combined $28,441,928,169 in adult-use cannabis excise and sales taxes, according to the Marijuana Policy Project.
2. 2025 was the highest-revenue year on record
States collected $4.57 billion in 2025, up from $4.42 billion in 2024. Annual revenue has grown more than 60-fold since 2014, when the first two markets raised $68.5 million.
3. 2022 is the only year revenue fell
Combined revenue dipped from $3.93 billion in 2021 to $3.82 billion in 2022 after the pandemic-era sales surge faded, then resumed growing in 2023 as new states opened stores.
Revenue by state
4. California collected over $1 billion in 2025
California brought in $1.049 billion in adult-use cannabis taxes in 2025 and $7.76 billion since sales began in 2018, the most of any state.
5. Seven states collected more than $200 million in 2025
California, Illinois ($552.6 million), Michigan ($507.3 million), Washington ($495.8 million), Massachusetts ($290.6 million), Arizona ($246.7 million), and Colorado ($220.9 million) each topped $200 million in 2025. Three of them cleared $500 million.
6. Washington has raised $5.1 billion since 2014
Washington has generated $5.12 billion in cannabis excise and sales taxes since July 2014, the second-highest cumulative total, under some of the highest rates in the country.
7. New York's revenue more than doubled its prior total in one year
New York collected $173.4 million in 2025, more than all of its previous years combined ($156.5 million), as licensed stores came online. Sales data in our cannabis industry statistics shows the same surge.
Mature-market decline
8. Colorado's cannabis tax revenue has fallen 44% from its peak
Colorado collected $396.2 million in 2021 and $220.9 million in 2025. MPP attributes the decline to lower prices, the end of the pandemic sales boost, and new legal markets in neighboring states drawing away out-of-state buyers.
9. Colorado's cannabis taxes still dwarf its alcohol taxes
In fiscal year 2025, Colorado collected $242.9 million in net adult-use cannabis taxes, more than 3.5 times its net alcohol taxes and fees. More than $1.5 billion of the state's cannabis revenue has gone to public schools.
How cannabis is taxed
10. State excise rates range from 6% to 37%
Percentage-of-price taxes are the most common structure, with state rates ranging from 6% in Missouri to 37% in Washington as of August 2024. Local governments in some states add 2% to 5% more, and many states also apply their general sales tax.
11. California raised its cannabis excise tax to 19%
California's excise tax on adult-use cannabis rose from 15% to 19% on July 1, 2025.
12. Three states tax cannabis by THC content
Connecticut, Illinois, and New York factor THC into their taxes. Connecticut charges 0.625 cents per milligram of THC on plant material and 2.75 cents per milligram on edibles; Illinois taxes products above 35% THC at 25% of the retail price, versus 10% below that threshold. Our THC potency statistics show why potency-based taxes are spreading.
13. Cannabis revenue funds schools, health care, and reinvestment
Arizona spends a third of its revenue on community colleges, Colorado funds school construction, Michigan funds K-12 schools and roads, and Washington directs about half to health care programs. Illinois, Massachusetts, New Jersey, and New York reinvest a share in communities harmed by past drug enforcement.
What it means for buyers
Cannabis taxes are a meaningful part of what you pay at the counter, and they differ more from state to state than almost any other consumer tax. A few practical points:
- Check whether prices include tax. Excise, sales, and local taxes can stack, so the shelf price is rarely the final price.
- Potency can change your tax bill. In THC-based tax states, high-potency concentrates and edibles carry higher taxes per unit.
- Medical cards can lower taxes. Several states tax medical purchases at lower rates; Washington, for example, exempts medical patients from its excise tax. See our medical marijuana statistics.
- Know your state's rules. Tax structures change often; our state cannabis law pages track what applies where you live.
Frequently Asked Questions
How much tax revenue has legal cannabis generated?
States have collected $28.44 billion in adult-use cannabis excise and sales taxes from 2014 through 2025, including a record $4.57 billion in 2025. These figures exclude medical cannabis taxes, local taxes, and licensing fees.
Which state collects the most cannabis tax revenue?
California. It collected $1.05 billion in 2025 and $7.76 billion since adult-use sales began in 2018. Illinois ($552.6 million) and Michigan ($507.3 million) were next in 2025.
What is the highest cannabis tax rate in the U.S.?
Washington's 37% excise tax on retail sales is the highest percentage-of-price rate, according to the Tax Policy Center. Missouri's 6% is the lowest. Several states also add general sales tax and local taxes on top.
Why is cannabis tax revenue falling in some states?
Mostly because prices are falling. In Colorado, revenue dropped from $396 million in 2021 to $221 million in 2025 as prices declined, the pandemic sales boost ended, and neighboring states legalized, reducing out-of-state shoppers.