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Legalizing recreational marijuana boosts the economy by creating new tax revenue and jobs.

For every $1.00 spent in the marijuana industry, between $2.13 and $2.40 in economic activity is generated for other industries, including but not limited to: tourism, banking, real estate, construction, and transportation. While 2017 estimates suggested the marijuana industry (adult-use and medical) in the United States could exceed $24 billion in revenue by 2025, the industry hit $24.6 billion in revenue in 2021, exceeding the market for energy drinks, milk, and orange juice. [1] [2] [3] [7] [278]

In Colorado, marijuana brings in three times more tax revenue than alcohol. The state raised $78 million in the first fiscal year after starting retail sales, and $129 million the second fiscal year. Washington collected a total of $220 million in tax revenues in its second fiscal year of sales. [15] [52] [53]

The legal marijuana industry generated $7.2 billion in economic activity in 2016, and added millions of dollars in federal taxes paid by cannabis businesses. A study on adult-use marijuana in Nevada projected $7.5 billion in economic activity over the first seven years of legalization in that state, including $1.7 billion in labor income. A study by the University of California Agricultural Issues Center estimated that the legal marijuana market in California could generate $5 billion annually. [4] [5] [6] [20]

In addition to creating tax revenue, legalizing marijuana creates jobs. As of Jan. 2022, the legal marijuana industry had created 428,059 American jobs, with 107,000 new jobs in 2021 alone, according to the Leafly Jobs Report. The report noted that jobs increased 33% from 2020 to 2021, or approximately 280 new jobs per day. 2021 was the fifth consecutive years jobs increased by more than 27%. [278]

An economic impact estimate from the Marijuana Policy Group forecast the creation of more than 130,000 jobs in California following legalization. Within a few years of legalization, approximately 18,000 additional full-time jobs were created in Colorado annually, both in the actual marijuana business as well as in related fields such as security and real estate. U.S. Representative Earl Blumenauer (D-OR) stated that the cannabis industry in the United States “is expected to produce nearly 300,000 jobs by 2020 and grow to $24 billion by 2025.” [15] [20] [59]

Further, all of the tax revenue in legal marijuana states provide funding to the police, drug treatment and mental health centers, and housing programs, along with school programs such as anti-bullying campaigns, youth mentoring, and public school grants. “The impact is really felt at the local level. Some counties have done 20 years of infrastructure work in just one year’s time. They’ve provided lunch for kids who need it,” says Brian Vicente, partner at Vicente Sederberg LLC, a law firm specializing in the marijuana industry. [40] [50] [73]

In Colorado, $40 million of marijuana tax revenue went to public school construction, while $105 million went to housing programs, mental health programs in jails, and health programs in middle schools in 2016-2017. [51] [52]

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