Short answer first: legal cannabis gets taxed twice in most states, once upstream at cultivation or wholesale and again at the register, and the combined hit usually lands between 15% and 40%. Washington carries the steepest single rate at 37% excise. Alaska charges no statewide cannabis tax at all. Everyone else sits somewhere in between.
How to Pay Cannabis Taxes: A Practical Guide
Here is a working list of cannabis tax rates by state, focused on what an adult-use customer actually pays at checkout. Figures reflect early 2025 and are the headline state rates. Legislatures adjust them more often than most people expect.
how are cannabis taxes calculated
The three taxes stacked on one bag
Cannabis taxes come in three flavors, and most states use at least two.
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- Excise tax. A cannabis-specific tax, usually a percentage of the retail price. This is the number people quote when they say a state taxes weed at 20%.
- Standard sales tax. The same tax you pay on toothpaste. It stacks on top of excise in most states, which is why the real number is higher than the headline.
- Wholesale or cultivation tax. Charged to growers and distributors, then baked into the shelf price before you ever see it.
Then local government gets involved. City and county add-ons are routine in California, Colorado, Illinois, Michigan, New York, and New Jersey, and they can tack on anywhere from 1% to 10% more.
Adult-use states and their headline rates
- Alaska: no statewide retail or excise tax. Some municipalities levy local sales tax.
- Arizona: 16% excise on adult use, plus 5.6% state sales tax and local additions. Medical patients skip the excise.
- California: 15% excise plus 7.25% state sales tax plus local. The cultivation tax ended in 2022.
- Colorado: 15% excise at wholesale, 15% retail marijuana sales tax, plus 2.9% state sales tax and local.
- Connecticut: 6.35% sales tax plus a potency-based excise tied to THC milligrams, which pushes effective rates into the high teens or beyond.
- Delaware: 15% tax on retail sales under its legalization law, with the first shops opening in 2025.
- Illinois: 10% retail excise on flower at or below 35% THC, 20% above that, 25% on edibles and concentrates, plus a 7% wholesale tax and local sales tax.
- Maine: 10% sales tax on adult-use products.
- Maryland: 9% adult-use sales tax. Medical purchases are exempt.
- Massachusetts: 10.75% excise plus 6.25% state sales tax plus up to 3% local.
- Michigan: 10% excise plus 6% sales tax.
- Minnesota: 10% gross receipts tax on retail sales, plus standard sales tax.
- Missouri: 6% adult-use sales tax plus local. Medical runs 4%.
- Montana: 20% retail tax on adult use, 4% on medical. No state sales tax.
- Nevada: 10% retail excise, 15% wholesale cultivation excise, plus 6.85% state sales tax and local.
- New Jersey: 6.625% state sales tax plus up to 2% local, with a separate social equity excise on cultivation.
- New Mexico: 12% excise plus gross receipts tax. Medical is untaxed.
- New York: 13% retail excise split between state and local, plus a potency-based wholesale tax.
- Ohio: 10% excise plus standard sales tax. Medical is exempt from sales tax.
- Oregon: 17% state retail tax plus up to 3% local. No general sales tax.
- Rhode Island: 10% excise plus 7% sales tax plus 3% local.
- Vermont: 14% excise plus 6% sales tax plus 1% local.
- Washington: 37% excise plus state and local sales tax, which puts the real total above 45% in some counties.
Medical-only states
Medical programs usually carry lighter taxes, and several states exempt medicine from sales tax entirely. Arkansas charges 6.5% sales tax plus a 4% privilege tax. Florida runs a medical-only market with no special cannabis excise. Oklahoma, Pennsylvania, Utah, and a handful of others tax medical sales at the standard rate or not at all. Virginia allows possession and home grow but has no retail market yet.
Why the list never matches your receipt
Three things throw off the math. First, excise often applies to the pre-sales-tax price, so the two taxes compound. Second, potency taxes in Connecticut, New York, and Illinois mean two products at the same sticker price can ring up differently. Third, local taxes vary by municipality within the same state, sometimes by several percentage points across town lines.
I always tell people to compare the shelf price to the final total on a $50 eighth. In Washington that eighth lands near $75. In Oregon, closer to $60. In Alaska, it can come out at the sticker price.
How to check your own numbers
Your receipt should break out cannabis excise tax and sales tax separately. If it does not, ask the budtender which line is which. State revenue department websites publish current rates and update them when laws change, and dispensary menus in competitive markets often absorb part of the tax into the listed price rather than showing it all at checkout.