Illinois marijuana tax haul down almost 4% from previous year despite record sales

Sales taxes collected from recreational marijuana purchases in 2023 were down almost 4% from the previous years, Illinois Department of Revenue records show.

The state collected more than $417 million last year, down from almost $434 million in 2022, state revenue records show.

That’s despite a report from the Illinois Department of Financial and Professional Regulation released Thursday that touted record sales of cannabis in 2023 at $1.6 billion.

Tax rates for recreational marijuana vary in Illinois depending on the potency of the product. There’s also greater competition in the marketplace these days, which is likely driving down prices in Illinois.

More than 42.1 million items were sold at dispensaries throughout Illinois in 2023, up 15.6% from 2022, according to IDFPR records.

Illinois residents still make up the lion’s share of recreational marijuana customers in the state, however the number of out-of-state customers declined significantly last year as recreational marijuana was legalized in several border states.

Last year, Illinois residents accounted for $1.2 billion in sales compared with $1 billion in 2022. Out-of-state residents only accounted for $408 million in sales in 2023, down 14.8% from $479 million in 2022.

Illinois has allowed recreational marijuana sales for four full years now. There are 177 recreational marijuana dispensaries operating statewide, including 67 considered “social equity dispensaries.”

Social equity dispensaries are intended to provide opportunities and assistance to people and communities – many with large minority populations – historically affected by marijuana criminalization. Almost 200 social equity dispensary operator applications are still being processed, IDFPR officials saod.

Revenue generated by recreational marijuana is funneled into the state’s general fund as well as a number of different state programs such as cannabis arrest expungement and state drug treatment efforts.

In addition to sales tax revenue generated by recreational marijuana last year, the state also collected almost $32 million from growers in 2023. That figure is up slightly from 2022, when the state received $31.1 million, according to IDOR records.

https://www.dailyherald.com/20240111/marijuana/illinois-marijuana-sales-taxes-down-nearly-4-from-previous-year/