Business · tax-revenue

States Earn $15 Billion in Cannabis Tax Revenue Over Five Years

U.S. Census Bureau data shows $3.5 billion collected in the last year alone, with collections rising steadily since Q3 2021.

By Priya Subramanian, Tax & Compliance ReporterPublished September 10, 20263 min read
Close-up of stacked coins and a calculator symbolizing financial strategy and budgeting.

Close-up of stacked coins and a calculator symbolizing financial strategy and budgeting.

States have collected more than $15 billion in cannabis tax revenue since the third quarter of 2021, according to a new U.S. Census Bureau report released September 10, 2026. The agency tracked $3.5 billion in collections over the most recent 12-month reporting period, marking the highest annual total since tracking began.

Census Bureau Tracks Five-Year Revenue Climb

The U.S. Census Bureau began tracking state-level cannabis tax collections in Q3 2021 and has recorded more than $15 billion in cumulative revenue through Q2 2026. The September 2026 report shows $3.5 billion collected in the trailing 12 months. That figure reflects continued expansion in adult-use markets and rising per-capita consumption in mature states.

The Census Bureau's Quarterly Summary of State and Local Government Tax Revenue captures excise taxes, retail sales taxes, and cultivation taxes levied on cannabis transactions. Medical and adult-use collections aren't distinguished in the dataset, nor does it adjust for differences in state tax structures.

A strict reading of the report puts the $15 billion aggregate at gross collections before any allocation to designated funds or administrative costs. States with earmarked revenue streams—such as education or social-equity programs—report net distributions separately in their own fiscal documents.

Annual Collections Rise Year-Over-Year

The $3.5 billion collected in the most recent 12-month period represents a year-over-year increase from prior reporting windows. Quarterly collections have climbed steadily since tracking began. No quarter has recorded a sequential decline in aggregate state revenue.

Two drivers explain this growth: the maturation of existing markets and the addition of new adult-use states. States that launched sales in 2022 and 2023—including Maryland, Missouri, and Ohio—contributed meaningfully to the national total in the most recent reporting period, while states with multi-year operational histories, such as Colorado and Washington, continue to post stable or modestly growing collections despite market saturation.

The Census Bureau doesn't forecast future revenue, but the addition of adult-use programs in Pennsylvania, Minnesota, and Delaware—all expected to begin sales in 2027—will likely push the five-year cumulative total above $20 billion by mid-2027.

State-Specific Revenue Profiles Vary Widely

The Census Bureau aggregates state-level data but doesn't rank individual states by revenue contribution in its summary report. Still, states with large populations and high excise-tax rates—California, Illinois, and Michigan—are known to account for a disproportionate share of the national total.

California's 15% excise tax, combined with local sales taxes that can exceed 9%, generates the highest per-transaction tax burden in the country. Illinois applies a tiered excise tax based on THC content, with rates ranging from 10% to 25% at the retail level. Michigan's 10% excise tax and 6% sales tax have driven collections above $1 billion annually since 2022.

For full background on state-by-state tax structures and revenue allocation, see the CannIntel topic hub on State Cannabis Tax Revenue. It tracks DCC, OCM, and CCC filings in real time and includes a breakdown of earmarked funds by jurisdiction.

Sources

cannabis tax revenueU.S. Census Bureaustate excise taxadult-use marketsCalifornia DCCIllinois CCC
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