Why it matters: The Marijuana Policy Project (MPP) has released a report that shows states in the US with cannabis legalization have generated over $15.1bn in tax revenue between 2014 and the end of 2022 as a result. The report highlights that states which choose to legalize and regulate cannabis are seeing hundreds of millions of dollars of extra revenue streams that can fund social services.
What they are saying: MPP President and CEO Toi Hutchinson said states that had not yet moved to legalize cannabis were doing a disservice to constituents and leaving money on the table as a result. Vicente LLP Director Andrew Livingston highlighted how cannabis demand increased during the pandemic, with people unable to go out to concerts or restaurants, and those extra funds contributing to cannabis tax revenues.
The big picture: While cannabis tax revenue is at an all-time high, some consumers and business owners have concerns over taxes. Legislation has been introduced recently that would allow cannabis businesses to remain in compliance with state law by creating an exception to Internal Revenue Code Section 280e.
What to watch: The report shows the individual 2022 tax revenue for 16 states, so trends of cannabis tax revenue, how it is used publicly, and efforts to address any issues related to taxes.
Take: The MPP report highlights how cannabis tax revenues can contribute significant funds to support public services such as education and drug treatment, which can be of benefit in states that have legalized cannabis. However, as with any tax revenue stream, issues related to taxes will need to be addressed to ensure businesses and consumers feel comfortable and that regulations are followed.
