Cannabis excise taxes average about 13% of retail price across product categories, but the wide variation between states makes apples-to-apples comparison nearly impossible without standardization.
Cannabis policy researchers, state tax officials, public health economists studying substance taxation, anyone comparing cannabis markets across states.
What the researchers found
Using retail scanner data from dispensary point-of-sale systems across 12 states with legal recreational cannabis (Q1 2020 to Q4 2024), researchers developed the first standardized tax metrics broken down by product category.
The standardized excise taxes were: $32.58 per ounce for flower, $180.21 per ounce for vaping products, and $0.024 per milligram of THC for edibles. Despite the very different dollar amounts, the tax incidence (ratio of tax to retail price) was remarkably similar across categories — 13.03% for flower, 13.59% for vaping, and 13.09% for edibles.
However, these averages masked enormous state-to-state variation. Standardized taxes and tax incidences varied considerably across the 12 states studied, reflecting the patchwork of tax structures that include ad valorem (percentage-based), weight-based, potency-based, and hybrid approaches applied at different points in the supply chain.
Why it matters
Cannabis tax policy is a key lever for public health — higher taxes can reduce use, particularly among price-sensitive populations like young adults. But because states tax cannabis in completely different ways (by weight, by price, by THC content, or some combination), comparing tax levels across states has been nearly impossible. This standardization framework makes those comparisons possible for the first time.
The numbers in context
12 states analyzed, Q1 2020–Q4 2024. Mean standardized excise taxes: flower $32.58/oz, vaping $180.21/oz, edibles $0.024/mg THC. Tax incidence: flower 13.03%, vaping 13.59%, edibles 13.09%. Significant variation across states in both absolute tax levels and tax incidence.
How the study worked
Observational study analyzing cannabis retail scanner data from dispensary point-of-sale systems in 12 states with legal recreational markets, covering Q1 2020 to Q4 2024. Tax structures at each supply chain stage were converted into standardized per-unit measures using retail prices. Tax incidence calculated as the ratio of standardized taxes to retail prices.
Who was studied
Analyzed retail scanner data from dispensary point-of-sale systems in 12 states with legal recreational cannabis markets.
What this study cannot tell us
Scanner data may not capture the full market (excludes illicit sales and some smaller dispensaries). The 12 states studied may not represent all legal markets. Tax structures are evolving rapidly — several states have changed their approaches since the study period. The standardization methodology requires assumptions about how supply-chain taxes pass through to retail prices.
How to read the evidence
Observational study using real dispensary sales data — strong for describing the current tax landscape but unable to establish causal effects of tax levels on behavior.
When this study was published
Published in 2026 with data through Q4 2024, capturing the most recent state of cannabis taxation across legal markets.
The bigger picture
Tax policy connects directly to the public health outcomes tracked elsewhere in this database. The college student study (RTHC-00253) found that more restrictive cannabis policies were associated with lower use. The driving impairment research (RTHC-00159, RTHC-00171) raises questions about whether tax-influenced pricing affects consumption patterns. By creating a standardized measurement framework, this study enables the kind of cross-state research needed to answer whether and how cannabis taxes actually influence health behaviors.
Replication
Not stated in abstract.
Funding
Not reported in abstract.
Conflicts of interest
Not reported in abstract.
Questions still open
- Is there an optimal tax rate that balances revenue generation with public health goals? Do higher standardized tax rates actually reduce consumption, or do they primarily drive consumers to the illicit market? Should edibles be taxed by THC content rather than by weight or price?
Read the original research
Standardizing Recreational Cannabis Excise Tax Rates in the United States: New Retail Price-Based Measurements by Product Category.
International journal of environmental research and public health, 23(1)
The International Journal of Environmental Research and Public Health is a reputable journal focusing on public health research.
Citation
Han, Bing; Cooper, Michael; Shang, Ce; Shi, Yuyan. (2026). Standardizing Recreational Cannabis Excise Tax Rates in the United States: New Retail Price-Based Measurements by Product Category.. International journal of environmental research and public health, 23(1). https://doi.org/10.3390/ijerph23010114