Washington, DC: Taxes derived from the licensed sale of state-regulated adult-use cannabis products totaled more than $4.5 billion in 2025 – the highest amount ever recorded in a single year, according to an analysis provided by the Marijuana Policy Project.
Seven states each collected over $200 million in adult-use cannabis taxes. Cannabis sales generated the greatest amount of tax revenue in California (over $1 billion), followed by Illinois ($553 million), Michigan ($507 million), and Washington ($496 million).
Since 2014, when Colorado and Washington became the first two states to regulate the adult-use cannabis market, states have generated a combined total of $28.4 billion in tax revenue from the sale of marijuana products.
“States with legal, adult-use cannabis sales have allocated tax revenues to a variety of needs, including their General Funds and specific services and programs,” the report states. “Cannabis taxes have provided funding for Medicaid, education, school construction, housing, roads, early literacy, bullying prevention, behavioral health, alcohol and drug treatment, veterans’ services, conservation, job training, conviction expungement expenses, and reinvestment in communities that have been disproportionately affected by the war on cannabis, among many others.”
Separate economic data provided last week by Vangst Staffing and Whitney Economics reports that some 412,500 workers are currently employed full-time by state-licensed cannabis businesses.
Full text of the report, “Cannabis Tax Revenue in States that Regulate Cannabis for Adult Use,” is available from MPP.