Currently 25 states and the District of Columbia have legalized cannabis in some form. Of the 25 states where cannabis is legal, 19 collect tax revenues from medical and/or recreational sales. These sales generate millions of dollars per year for each state.
Additionally, 9 states have initiatives on the November 2016 ballot that will allow them to decide whether to legalize either the recreational use or the medical use of cannabis.
The states most likely to legalize cannabis for recreational use in November are California and Maine, where public support has been high for a long time. Projections show that if California were to legalize cannabis, tax revenues there could be as high as $1 billion by 2020. Maine looks to take in at least $18 million per year. These are large income streams to potentially borrow against. States and localities could bring future revenues to the present, which would later be paid back by cannabis revenues as they come in.
There are still some kinks to work out in states that have legalized cannabis for medical or recreational use. Michigan, which approved cannabis for medical use in 2008, has the potential to take in at least $44 million in tax revenues per year. It took the state until this year, however, to adopt legislation for the implementation and regulation of cannabis sale and distribution.
Delaware, Maryland, Massachusetts, Minnesota, New Hampshire and Vermont have all legalized medical cannabis but are not receiving any revenues because they do not have a taxation system in place. Oregon and Washington, who have been selling cannabis recreationally and have already seen tax revenues, are still in the process of finalizing their programs and working out some regulatory issues. Colorado, who legalized cannabis for recreational use first, seems to have things fairly well figured out: tax revenues reached $57 million in just the first 4 months of 2016.
Although some states and the federal government have yet to come to terms with legalizing and taxing a Schedule I drug, it will eventually be hard to ignore the numbers.
The amount of tax revenues that cannabis can generate for the country and each state will benefit areas that need it most such as education, homelessness and road improvements, as well as reduce spending on drug enforcement. Here is a breakdown of each state, based on information readily available through sources such as ballotpedia.org and websites of any state where cannabis has been legalized.