How Do Americans Spend Taxes Collected from Marijuana Sales?
One of the main goals of legalizing marijuana in Canada and U.S. states was to generate additional revenue for government budgets. So, how do American authorities spend the taxes collected from cannabis sales? Let’s take a closer look using Washington State as an example.
Washington State: Cannabis Taxes to Add $1 Billion to the Budget
Washington’s model for allocating cannabis tax revenue is a good case study. Economists predict that from 2021 to 2023, the cannabis industry will contribute $1.045 billion to the state budget. According to the legalization law passed in 2012, these funds are earmarked for public programs.
Healthcare
The Washington government will allocate just under half of the tax revenue ($490.4 million) to the Primary Health Care Trust Fund. This money will be used to pay for medical services provided free of charge to uninsured and low-income residents. An additional $98.9 million will go to the Department of Health, which will distribute funds to community health centers serving low-income or uninsured Americans.
Regulation and Law Enforcement
$24.3 million will be directed to the Department of Alcohol and Cannabis Control. This agency uses the funds to pay staff who ensure cannabis companies comply with legal requirements. Another $5.6 million will go to the state police department for combating illegal cannabis sales and to patrol officers who test drivers for THC.
Education
The Department of Health will receive $21.2 million for educational programs. The department provides grants to local health departments to launch projects aimed at reducing cannabis use among minors. Program leaders share research-based information with young people about the potential negative effects of marijuana use, helping them make informed choices.
- $1 million will go to Building Bridges, an organization that helps students graduate from high school. Staff support at-risk youth by offering technical training courses or online education options.
- $40,000 will be allocated to the Institute for Alcohol and Drug Abuse for updating materials on its website.
Additionally, $368.5 million will be transferred to the state’s General Fund, which finances preschools and schools. Senator Christine Rolfes stated that the legal cannabis industry makes a significant contribution to the education system in Washington, but officials do not plan to launch new projects in this area using cannabis tax revenue.
Scientific Research
The Washington State Institute for Public Policy will receive $400,000 to prepare reports on the impact of marijuana legalization on the healthcare system and the effectiveness of public campaigns aimed at reducing marijuana use.
- The University of Washington and Washington State University will receive $504,000 and $276,000, respectively, to study the long-term effects of marijuana use.
- $1 million will be spent on conducting surveys among teenagers.
- $1.3 million will go to the Department of Agriculture for testing marijuana for pesticide levels.
In summary, the taxes collected from marijuana sales in Washington are primarily used to fund healthcare, regulatory oversight, education, and scientific research, benefiting a wide range of public programs and services.