A big reason why support for marijuana legalization is surging is because of the tax revenue potential that legalization would create. Every state in America needs more funding, and marijuana legalization basically creates a new tax revenue source out of thin air. Marijuana sales are going on in every state in America regardless of the legal status of marijuana in those states, so by bringing those transactions out of the shadows and into the daylight, marijuana can help states with funding.
Alaska voters approved marijuana legalization in 2014, and the Alaska Department of Revenue recently released the results of a study that estimates how much money Alaska will make from marijuana taxes. Per Marijuana Business Daily:
A report by the Alaska Department of Revenue estimates that the state will collect anywhere between $5 million and $19 million in taxes from recreational cannabis sales to locals, indicating the huge amount of uncertainty over the potential size of the market.
The state did not provide a revenue projection, though the report estimates annual consumption among residents will range from 102,000 ounces to 384,000 ounces, according to the Alaska Dispatch News.
Based on the state’s figures and average cannabis prices in other rec markets, sales could come in between $15 million and more than $75 million.
Those estimates are in line with estimates that were released leading up to Election Day 2014 by the Marijuana Policy Group, an organization based out of Colorado. At that time the estimate was that the first year of legalized sales would generate seven million dollars in tax revenue. That same research estimated that by 2020, Alaska’s marijuana industry would generate upwards of 23 million dollars annually in tax revenue for the state. These numbers of course don’t include the amount of money that will be saved from not enforcing marijuana prohibition, which is a large sum I’m sure.
