Is The Sales Tax On Marijuana In NY Highest In America?

With legal state-sanctioned legal recreational sales now a real thing in New York, let's take a look at how much tax revenue the State makes. People spend a lot of money on things like gambling, alcohol, tobacco, sex, drugs, and marijuana, so the tax income potential is ripe in New York. Marijuana sales have the potential to be very lucrative for the state.

How Much Money Can New York State Make From Marijuana Sales?

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Looking at the tax revenue California generated this year from adult-use marijuana sales can give us an idea of what New York can expect. According to the California Department of Tax and Fee Administration, Cali made almost $358 million in the three quarters it has listed on its website for last year.

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How Much Does New York State Tax Marijuana

New York predicts that the adult-use cannabis industry will generate millions, possibly billions of dollars in revenue for the state from taxes and other fees. The state's taxation plan aims to make sure it maximizes the legalization of marijuana. In addition to taxing distributors of adult-use marijuana products in the state, there are two taxes that consumers will pay. These taxes will be active soon, once the first legal retail dispensaries and lounges open,

There is a state excise tax imposed on the sale of cannabis products by a retail dispensary to a cannabis consumer at 9 percent of the products’ price.
There is a local excise tax imposed on the sale of cannabis products by a retail dispensary to a cannabis consumer at four (4) percent of the products’ price. This tax is distributed to local governments based on where the retail dispensary is located.

So, the total sales tax on marijuana in New York State is 13 percent

The tax revenue doesn't even include the fees imposed for licenses and other requirements for businesses participating in the marketplace.

When it comes to taxing cannabis, you might think New York has the highest tax in America. I mean NY does have high taxes for pretty much everything, right? Surprisingly, New York doesn't have the highest sales tax on marijuana. Looking at the 20 other states that have some form of legalized marijuana, we're actually on the lower side. According to SILive.com, here's how much other states tax marijuana,

ALASKA

Mature flower - $50 per ounce
Immature flower - $25 per ounce
Trim - $15 per ounce, $1 per clone

ARIZONA

16% excise tax on retail price

CALIFORNIA

15% excise tax
Flower - $9.65 per ounce and $2.87 per ounce leaves cultivation tax
Fresh cannabis plant - $1.35 per ounce

COLORADO

15% excise tax on retail price
3% tax on retail price

CONNECTICUT

6.35% sales tax
3% local sales tax

ILLINOIS

Flower or products with less than 35% THC – 10% tax
Flower or products with more than 35% THC – 25% tax
Edibles and cannabis infused products – 20% tax

MAINE

10% sales tax retail price

MASSACHUSETTS

10.75% excise tax
6.25% state sales tax
Up to 3% local option for cities and towns

MICHIGAN

10% excise tax retail price
6% sales tax

MONTANA

20% excise tax retail price

NEVADA

10% excise tax retail price
15% excise tax on fair market value at wholesale
Sales tax based on locality

NEW JERSEY

$10 per ounce, if retail per ounce is $350 or more
$30 per ounce, if retail per ounce is between $250 and $350
$40 per ounce, if retail per ounce is between $200 and $250
$60 per ounce, if retail per ounce is less than $200
All transactions are subject to sales tax of 6.625% plus a social equity excise fee of 1/3 of 1%.

NEW MEXICO