In another sign of the growing popularity of marijuana, the state of Massachusetts recently passed a milestone: it collects more money in cannabis taxes than it does from taxes on alcohol.
Also, it’s not even close. Through the state’s current fiscal year, which reached a midpoint in December 2021, Massachusetts collected $51.3 million in alcohol excise taxes and $74.2 million in marijuana taxes, according to ABC affiliate WCVB in Boston.
Illinois also has passed this same milestone, bringing in $100 million more in marijuana taxes than it did in alcohol taxes in 2021. That’s allowed the state to put millions into the state’s R3 program that funds grants to support community reinvestment projects.
The Growing Popularity of Cannabis
Alcohol sales have not dropped in Massachusetts, but they have not increased at the rate that cannabis sales have increased.
Numbers provided by the state show that cannabis brought in $112 million in excise taxes in 2021. That’s 206% higher than what the state projected. Also, gross sales in Massachusetts have skyrocketed since recreational sales became legal in November 2018. Dispensaries in Massachusetts have made $2.54 billion since legalization, with $1 billion made in 2021 alone.
The gap between alcohol taxes and marijuana taxes could narrow if Massachusetts State Representative Kay Khan wins approval for a proposed bill that doubles the tax on alcohol. Kay favors the increase because the state spends an estimated $2.6 billion every year on programs to help people combat alcoholism and addiction.
Are People Replacing Alcohol With Cannabis?
People interviewed by WCVB said that the rapid increase in cannabis tax dollars reflects what they see among their friends and peers.
“In my circle — I’m 30 — people drink less alcohol and smoke more weed, at least in Massachusetts,” one dispensary customer told WCVB. And Mikayla Bell, community outreach manager for Massachusetts cannabis retailer NETA, said that “people are looking for alternatives to make them feel better.”
“Oftentimes people are turning to alcohol for relief. And now they found another product without the hangover, without the calories,” she said.
Past surveys have found that making the switch from cannabis to alcohol is a trend among younger generations. For example, a survey of Millennials found that more of them than ever are likely to combine alcohol and marijuana. About half of those people consume less alcohol.
The decision to use less alcohol also has led to a boom in the creation of cannabis-infused beer that is non-alcoholic. These craft beer companies have eliminated the alcohol and replaced it with THC, providing a different kind of “buzz” for drinkers.