Washington, D.C. — States have generated a combined total of more than $28.4 billion in tax revenue from legal adult-use cannabis sales since the first markets launched in Colorado and Washington in 2014, according to a comprehensive new state-by-state report published by the Marijuana Policy Project (MPP).
In 2025 alone, legalization states collectively generated more than $4.57 billion in cannabis tax revenue from adult-use sales, which is the most revenue generated by cannabis sales in a single year. Further, seven states collected over $200 million in adult-use cannabis taxes. Three of those states — California, Illinois, and Michigan — generated over $500 million in revenue, one of which (California) collected over $1 billion.
“At a time when pressure is building on state budgets, adult-use cannabis taxes are providing relief,” said Adam J. Smith, Executive Director at the Marijuana Policy Project. “Legal adult-use markets have become powerful economic engines, creating thousands of new jobs and small business opportunities across the country. While economic growth and state revenues aren’t the primary reasons for legalizing adult-use cannabis, the positive financial impact is undeniable. That said, it is important to keep in mind that overtaxing legal cannabis can be self-defeating, driving consumers back to the unregulated, unsafe, and untaxed illicit market, which is bad for state budgets and for public health and safety. More importantly, ending prohibition has spared hundreds of thousands of individuals the trauma of arrest and incarceration, while data shows teen cannabis use rates have actually decreased in most legal states.”
Pennsylvania has not legalized the use of recreational marijuana although Gov. Josh Shapiro has called for it in each of his budget proposals. Last February, Shapiro’s budget estimated the state would rake in $729.4 million in the first year from taxes and one-time licensing fees. That’s up from last year’s prediction of $536.5 million.
In May 2025, the state House passed legislation in a party-line vote that would legalize and regulate adult-use cannabis. The bill has languished in the State Senate Law and Justice committee since after a 3-7 vote to report the legislation.
GOP candidate for governor Stacy Garrity has stated that she does not support legalizing recreational marijuana and said that as long as Republicans are in the majority in the state Senate, “they’re never going to pass it.”
Currently, 24 states and the District of Columbia have legalized cannabis possession for adults 21 and older. With the exception of Virginia and D.C., all have legalized, regulated, and taxed cannabis sales.
Here is what neighboring states brought to the coffers in state tax revenue from adult-use cannabis:
Delaware. (15% excise tax on sales)
August 1 – December 2025: $3,112,599
Maryland. 12% tax rate at point of sale
2025: $90,396,740 | Since July 1, 2023: $190,065,777
New Jersey. (6.625% standard sales tax, 1-2% local option taxes; fluctuating excise fee based on average sale price: $2.50 per ounce)
2025: $78,475,863 | Since July 1, 2022: $208,901,251
New York. (9% cannabis wholesale tax, 9% sales tax, 4% local sales tax)
2025: $173,363,400 | Since 2023: $329,863,400
Ohio. (10% excise tax on sales, 5.75% state sales tax, and local taxes up to 2.25%)
2025: $130,636,503 | Since August 2024: $146,976,599
MPP’s report reviews each legalization state’s adult-use cannabis tax structure, population, and year-by-year adult-use cannabis tax revenue in chronological order, based on when state-legal cannabis sales began. These figures include cannabis excise taxes and states’ standard sales taxes that are applied to cannabis. They do not include medical cannabis tax revenue.