How States Allocate Cannabis Tax Revenue Is Complicated And Varies By Market

Due to the ongoing U.S. federal prohibition of cannabis, states must implement their own regulations and various excise and sales taxes. Excise taxes in many Western U.S. states tend to hover 15% while others, like Washington, charge 37%.

Additional charges may come in the form of additional municipal taxes, per ounce cultivation rates, potency and other measures, depending on regulations.

Cannabis markets typically see varying success with the revenue they generate, as well as what the money goes towards.

How States Tend To Allocate Cannabis Tax Revenue

“Most states allocate their cannabis tax revenue towards various public health and safety, education and social equity programs,” says Laura Bianchi, a partner at cannabis legal firm Bianchi & Brandt.

Funds also often go toward programs aimed at combating substance abuse and the effects of the drug war.

“Programs that provide transparency to the public, including a clear understanding of the use and…

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