Marijuana just became worth more to the commonwealth of Massachusetts than alcohol for the first time.
Halfway through the current fiscal year, in December of 2021, Massachusetts reported collecting $51.3 million in alcohol excise taxes and $74.2 million in marijuana excise taxes.
Alcohol consumption in Massachusetts is hardly falling—instead, marijuana purchases are increasingly growing across the state.
Alcohol excise taxes, which are charged on each gallon of alcohol produced, have also remained relatively stagnant over the last five years, at $0.55 per gallon of wine, and $4.05 per gallon of hard alcohol. The state charges an excise tax of 10.75% on the projected retail price of recreational cannabis in addition to a 6.25% state sales tax, plus a local tax of up to 3%.
The commonwealth collected more than $112 million in excise tax from recreational marijuana sales in all of 2021, according to data from Massachusetts’ Cannabis Control Commission. That was 206% higher than projected.
The changes reflect the marijuana industry’s huge growth since adult-use retailers opened in Massachusetts in November 2018. Gross total sales have now reached $2.54 billion, according to the Cannabis Control Commission, and sales in 2021 alone totaled nearly $1 billion.
The Commission, a governmental organization that monitors the opening of dispensaries and sales of marijuana in the commonwealth, said the increase in revenue came at no cost to public safety or health.
“This number also underscores the entire agency’s tireless efforts, particularly those of our hardworking staff, to thoughtfully regulate a safe, accessible, and effective adult-use marketplace that keeps critical tenets of our mission—public health, public safety, and equity, among others—front of mind,” Commission Executive Director Shawn Collins said in a statement on Tuesday.
Massachusetts wasn’t the only state to have a marijuana milestone year. Illinois also saw weed tax revenue beat out booze for the first time in 2021, with the state collecting nearly $100 million more from adult-use marijuana than alcohol.
States that have legalized marijuana have made more than $10 billion in cannabis tax revenue since licensed sales began in 2014, according to the Marijuana Policy Project.
Alcohol taxes in Massachusetts may soon be increasing. State Representative Kay Khan has filed a bill to double the excise taxes on beer, wine and liquor (H 2973). Kay said the state spends $2.6 billion every year in response to alcoholism and addiction, and should consider offsetting those costs by charging the alcohol industry.
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