As state-led cannabis legalization ramps up in the United States, it’s no secret that financially this has been a tremendous boon to the economy in states where adult-use recreational use is legal. It seems that with every month, a new state is breaking its own and others’ records when it comes to total cannabis tax revenue.
The Commonwealth of Massachusetts is no different; according to the Boston Globe, since 2018 when dispensaries began operating in the state, it has now sold over $1.5 billion in cannabis products:
Industry experts said they expect Massachusetts marijuana stores will easily surpass $1 billion in sales in 2021. So far this year, they’ve sold around $359 million of products, and new retailers are opening nearly every week, as the cannabis commission substantially increases its pace of licensing and municipalities grow less reluctant to host cannabis facilities.
It’s important to be a responsible and conscientious modern cannabis consumer — it’s also important to know and understand where your cannabis tax revenue is allocated within the state — and how this flow is positioned in regards to making a difference while generally ensuring a better quality of living for all.
So, where does your Massachusetts’ Cannabis Tax Revenue go? Follow along as we discuss the particulars of tax revenue placement in the Bay State.
What are Massachusetts' Current Cannabis Tax Rates?
First, let’s take a look at Massachusetts’ current cannabis tax rates. Here are the major points:
- Cannabis product purchases are subject to a 10.75% marijuana excise tax
- Also include the state’s normal 6.25% sales tax
- & optional local excise tax, up to 3%
With a total tax rate of 20%, there is certainly a lot to work with when it comes to using all this revenue for public good.
2019 & 2020 Cannabis Tax Revenue Totals:
- Sales Tax: $38.16 million
- Excise Tax: $65.63 million
- Local Option Tax: $18.28 million
About Massachusetts' Marijuana Revenue Fund
The Marijuana Revenue Fund was created in order to facilitate the operating expenses of the CCC (Cannabis Control Commission), including everything that has to do with managing a rapidly-expanding cannabis industry within the commonwealth. It has also outlined some guidelines for where the excess cash should go:
The excess money in the MRF must flow to a number of initiatives aimed at addressing potential impacts of the newly legal industry, as well as the government’s treatment of marijuana in the past. According to the CCC, those efforts include public awareness campaigns; public and behavioral health, including “evidence based” substance abuse prevention and treatment, as well as local grants for youth education; public safety; municipal police training; and the state’s existing Prevention and Wellness Trust Fund.
Municipalities: Where exactly does Massachusetts' Cannabis Tax Revenue go?
Finally, now that we’ve covered the financial and legislative portions concerning Massachusetts’ cannabis tax revenue, let’s move on to talk about where it actually goes. While there is unfortunately no main database that tracks where all this money goes, individual municipalities are therefore tasked with the responsibility of deciding how the funds are spent.
Among other channels, here are some of the major destinations of Massachusetts’ substantial cannabis tax revenue:
- City Departments
- Road improvements
- Sidewalk construction
- On-street parking
- & more!
Lazy River Products (Dracut, MA) is proud to do our part in making our state stronger!
Our team at LRP fully believes in the power of cannabis to force positive change, within ourselves, our local communities, and the United States at large. We’re proud to do our part in giving back!