California Cannabis Taxes Reach $216M During Q1; Down About $32M from 2022 Q4

California cannabis taxes topped $216 million during the first quarter of the year, according to California Department of Tax and Fee Administration data outlined by KTLA. The total is down about $32 million from quarter four of last year when the state collected $248.5 million in cannabis taxes. 

The reduction can be attributed, in part, to the state ending the imposition of a cannabis cultivation tax in July 2022. The quarter-one total also does not include outstanding tax returns or returns that are still being processed and only reflect the tax revenue paid to the state; many cities and counties have their own additional fees and taxes that are collected at the local level. 

Falling state tax revenues are not unique to California, however, as a recent Marijuana Policy Project (MPP) report found cannabis tax revenues in the U.S. declined from $3.867 billion in 2021 to $3.775 billion in 2022. The MPP suggests the decrease is due to falling cannabis tax revenues in the six states that first legalized cannabis for adult use.  

In all, California — which was the fifth state in the U.S. to pass adult-use cannabis legalization — has collected nearly $5 billion in total cannabis tax revenues since the reforms took effect there in 2018.