New York Could Be Earning Millions in Marijuana Tax Revenue

New York legalized medical marijuana in 2014 and, following Gov. Andrew Cuomo's request for a study, analysts predict the state may legalize recreational marijuana.1 Using Colorado's marijuana revenue per capita, how much could New York earn in recreational sales and tax revenue?

Gross sales, 2016-17 fiscal year

Colorado

New York

Current dispensaries per 100 thousand people

Gross sales per 100 thousand people

Colorado

New York

Tax revenue

Colorado

New York

Increased Recreational Marijuana Revenue Over Time

When states legalize marijuana, they undergo a transitional period of setting up infrastructure, building consumer awareness of the new dispensary system and finding the right tax rate to compete with black market prices.2 Sales and tax revenue in states such as Colorado have gradually increased in the years after legalization of recreational marijuana. 

Gross sales

Gross sales
Years following recreational legalization Colorado New York (Projected)
1 $303.2M $1.1B
2 $577.5M $2.0B
3 $861.6M $3.1B
4 $1.1B $3.9B

Tax revenue

Tax revenue
Years following recreational legalization Colorado New York (Projected)
1 $45.5M $161.0M
2 $86.6M $306.7M
3 $129.2M $457.5M
4 $163.7M $579.5M

States allocate marijuana tax revenue to key infrastructure and services. In the 2016-17 fiscal year, the major recipients of marijuana tax fund revenues in Colorado were:

Marijuana Excise Tax3

Marijuana Tax Cash Fund4

Created by MBA@Syracuse, the online MBA program from Syracuse University

Sources:

1 https://www.vice.com/en_us/article/vby543/new-york-is-closer-than-ever-to-legalizing-weed Return to footnote reference
2https://taxfoundation.org/marijuana-taxes-lessons-colorado-washington/ Return to footnote reference
3https://www.cde.state.co.us/communications/20160902marijuanarevenue Return to footnote reference
4http://leg.colorado.gov/sites/default/files/fy17-18apprept.pdf Return to footnote reference

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